Select Committee on International Development Minutes of Evidence

Examination of Witnesses (Questions 1 - 19)




  1. Secretary of State, as always you are very welcome indeed here and thank you also for helping us by attending the conference with the World Bank which has just concluded and helping us finance the conference, which generally speaking seems to have been thought to have been a very focused and useful meeting. We have to organise it more strongly. I believe in fact it will quickly get out of control in terms of numbers and finance. Nonetheless, I should like to thank you for supporting us in that way. I believe you have an opening statement to make on the Globalisation White Paper and I think it is the Committee's duty to give you that opportunity since you have not had one in the House so far. May I ask you to do that?

  (Clare Short) Yes; thank you. I shall be brief. It is important to say that this second White Paper since we formed our Government stands alongside the first White Paper, does not replace it and also stands alongside the target strategy papers which lay out how each of the international development targets could be achieved if we can mobilise sufficient international effort. It looks specifically at globalisation itself, the nature of it, the historical and economic change which it represents and sets out an agenda for managing the process in a way which will ensure that the abundance and technology and capital which is now available is managed in a way that brings real benefits to the poor of the world rather than marginalises and excludes them. The reason for the White Paper is twofold. One is that since our Department was formed with the extra analytical capacity to look at trade, investment, core labour standards, environment, corruption, money laundering, all of that and ceased to be just an aid distribution department, which was looking for all the policies across government which would promote sustainable development for the poorest countries, there has been a lot of new cross-Whitehall work and we wanted to consolidate that into a statement of government policy. There has been a lot of change and improvement so it is a commitment of the Government right across government, committing us through trade, through approaches to investment agreements, environmental negotiations and so on, to promote an international system which will really encourage development for the poorest countries. The second reason is to address the enormous muddle and confusion there is in public debate about the nature of globalisation, which I find worrying. Quite a lot of development NGOs for example are in an ideological position of opposition to globalisation because they are treating it as though it is the same thing as neo-liberalism and that is potentially a very dangerous area. A lot of the voices of Seattle and Prague and so on claim to be speaking in the interests of the poor of the world but are basically making protectionist arguments. If they become the predominant view of how the interests of the poor world are to be protected, the world would roll into a protectionist era which would damage the interests of developing countries. So the second purpose is to elaborate as clearly as possible an analysis of what globalisation is, the effects it is having and try to make clear to everyone that it does not have some inevitable output. It is for humanity and the political systems of the countries of the world to shape this if we want to make sure that it brings benefits to all. There are two possible futures, one is where it is left on its present track, which will potentially lead to more and more marginalisation of poor countries and people, or we can make the sorts of changes which are advocated in the White Paper and which are achievable and we could see a massive uplift in conditions of the poor of the world by making use of the knowledge and technology and capital and so on which is there. The final point I would make is that we have engaged in the widest ever consultation undertaken by the Department internationally as well as in Britain, discussions with different groupings and representatives around the world and that is part of the objective both to hear what is being said across the world, but to generate a more informed and thoughtful debate about the nature of globalisation and how we can shape it. The White Paper is selling very well. It is being demanded across the world at great speed. The first print run of 10,000 is already gone and it is being reprinted. There have been 8,000 hits on our website, so it is stirring up enormous interest across the international system which is very good. We are pleased with the initial reception but obviously the task it outlines is enormous. It is to get the whole international system to be more focused on the needs of the poor, to commit itself to systematic poverty reduction and to get changes of the rules in trade, investment, the environmental agreements, the enforcement of core labour standards and the rest, in a way which brings sustained and large benefits to the poor. It is a very, very big task but enormous progress is possible if we can get a united determination in the international system to make progress.

  2. I did not invite you to introduce your colleagues, but of course we know them very well and should like to offer our welcome to both David Batt and Richard Manning. We are glad to see you again. Did they help you write the report?
  (Clare Short) Indeed. Richard Manning is the number two level in the Department and supervised all the work. David Batt headed up the team which did both the preparatory and analytical work for the White Paper and drafted it. There is a little of my own hand in the drafting too.

  3. I thought I recognised your hand when I read one particular paragraph. It says, "If democrats and internationalists do not address these concerns, then those who advocate narrow nationalism, xenophobia, protectionism and the dismantling of multilateral institutions will gain in strength and influence with disastrous consequences for us all". I thought I recognised your phraseology there. Are you trying to maintain that in fact globalisation will automatically benefit the poor?
  (Clare Short) Absolutely not. I find it worrying that so much of the debate about globalisation talks as though it is some ineluctable force which humanity cannot shape and change. Globalisation has been going on since the industrial revolution: the increasing interdependence in trade and spreading of technology and information across the world. It speeded up recently because the end of the cold war resulted in one global economy rather than two blocs and because of information technology and the speed therefore with which information, capital and so on can flow around the world. Like any previous phase of history, it can be shaped by politics and democracy and we have more democracy in the world than we have ever had in human history. It is for us in our countries and then all the intergovernmental organisations to which we contribute to determine that it brings benefits to the whole of humanity rather than marginalises some. It is a matter of will and choice, as I say in the introduction, and not some sort of inevitable process. I was struck in lots of the interviews I did after the White Paper was published that people were asking whether I was saying that globalisation was good or bad, as though we had to find it out there in the sky and decide whether it was a good or bad thing rather than bend our international and national political institutions to shape it in a way which would bring benefits.

  4. So globalisation is there whether we like it or not. We have to shape it to benefit the poor, we have to have the political will to benefit the poor, we cannot just leave it.
  (Clare Short) Absolutely. The parallel I often draw is with industrialisation. The industrial revolution began and people in this country came out of the countryside where many of them were living in great poverty, to live in the cities in squalor, in slums, with child labour and low life expectancy and high maternal mortality and all the sorts of conditions we now measure in the poorest countries. There was then a political struggle for democracy and for a commitment to social justice so that the new wealth being generated by industrialisation was shared and brought benefits to all the population of the country. It is a similar parallel. The wealth is being generated: it is for democratic decisions and political decisions to determine who will get the benefits and whether the poor are brought into those benefits.

  5. As I understand your paper, you see these benefits arising because of growth. Do you believe and does the Department believe that we shall realise the international development targets through growth alone or are there other factors which will have to be brought in in order to realise the international targets which you have made the centrepiece of your policy since you took up the job of Secretary of State in your last White Paper?
  (Clare Short) Indeed and we now have unprecedented international commitment to the targets which gives us the capacity to drive the whole international system forward together. What we are saying is that there cannot be a reduction of poverty without economic growth and there is no question about that. Some of the countries which have seen a great rise in poverty have seen that because they have had population growth faster than economic growth. That happened in a number of African countries in particular in the 1980s and early 1990s and in those conditions poverty invincibly rises. There has to be economic growth in order to reduce poverty; there is no question about that. However, special efforts need to be made to ensure that everyone is included in the benefits of that growth. So the poorest people in the world, some of the people who live in the most remote rural communities, have no access or contact with markets, so globalisation is not affecting them but they are living in great poverty and they need access to credit, to send their children to school, access to health care and rural roads so they can get their produce to market in order to be able to benefit. There need to be measures to ensure that all are included; if change is causing some to lose out, that they are helped to get through that process of change and take benefits from the growth which is taking place in the economy, and you need active governments to benefit from the knowledge economy and the new technologies which are driving a lot of globalisation. Education is not just a human right it is an absolutely essential economic investment and you need governments which are committed to education for all children starting with universal primary education. You must have growth plus these other measures which make sure the growth brings benefits to all and that there is investment in human development which enables individual human beings to benefit from economic change.

  6. CAFOD and Christian Aid have stated that "the White Paper is at best ambivalent and at worst evasive on inequality and redistribution".
  (Clare Short) That is just false. There are different elements in Christian Aid because I had responses to the White Paper from different levels of the organisation saying very different things. Here we are coming to the nub of the ideological position of a lot of development NGOs. They are adopting a posture of being hostile to globalisation, I think not fully understanding what they are doing, with a hangover mindset of the effects of neo-liberal policies of the 1980s and 1990s which did call for allowing the market to rip and rolling back the state and led to the exclusion of some people. The White Paper does not advocate those policies and neither are those policies what globalisation is. The White Paper makes absolutely clear that if you look at the levels of inequality nationally, you know it is often asserted that globalisation is leading to a growth of inequality in the world. That is not so. Some years back there was widening inequality. It has been narrowing recently. Objectively what is going on is that the OECD countries are continuing to grow at an average of 2.5 per cent per year and some variability in that sort of performance. Whether global equality narrows or widens depends on the performance of the poorer countries. Because in recent years China in particular has performed so spectacularly well, growth has increased in India and indeed in Bangladesh, so some of the most populous countries, the poorer countries have come up and global inequality has narrowed. The White Paper makes that clear. It also makes clear that there is not some inevitable consequence of opening up in terms of inequality, that of different countries which have opened some have become less unequal, some have become more unequal. It depends on policy, policy choices of governments. It also makes it clear that economic growth reduces poverty more rapidly in less unequal countries because of course the fruits of growth tend to go to people in proportion to the original distribution of income. In a highly unequal country, the poor get a relatively small share of economic growth and it takes much longer for economic growth to lift them up, whereas in a less unequal country, the economic growth lifts them up much more rapidly. So it is highly desirable to lessen inequality and the whole process of social inclusion and the effectiveness of government and investment in health care and education for all, which is so strongly advocated in the White Paper, are means of reducing inequality. That is just a nonsensical piece of ideologically-driven failure to read what is contained in the White Paper.

  7. What specific redistributive measures are more important?
  (Clare Short) We need to be clear about redistribution. It is very difficult if you look at the record of all countries to redistribute from a static position, whereas to share more fairly the proceeds of growth is a much more easily achievable political object. In many of the countries in which we work elites are enormously powerful. Sub-Saharan Africa is very, very unequal, as is Latin America. Politics in sub-Saharan Africa is frequently totally dominated by elites who tend to be urban dwellers, who want modern healthcare systems and will skew the whole of the health budget to be spent on state-of-the-art hospitals in urban centres, who want higher education for their children, understandably, but there are privileged elites and therefore the whole of the education budget is biased there and there is no primary education for all. We advocate very strongly, measures which invest in the healthcare and education of all people, both as a social good but also to get an efficient modern economy. These are all profoundly redistributive measures or measures of social inclusion which ensure that marginalised and poorer people can participate in the modern economy and get benefits from economic growth.

  8. How is the Government seeking to assist those adversely affected by change through risk reduction, mitigation and coping mechanisms?
  (Clare Short) Do you mean what measures are we recommending that governments should take?

  9. Yes. The White Paper says that "all profound economic and social change produces winners and losers". How are we going to protect the losers?
  (Clare Short) What I am just trying to make clear is that the UK Government is not in a position to protect all the losers of the world. What we have to do is advocate policies for governments in developing countries. They must take the lead in all of this, but then all the international agencies to help the process of managing change where some people are going to lose out and need help to adjust to that change. For example—and I think this example is in the White Paper—in the 1960s many countries put up high tariff barriers to try to encourage development by having nationally owned industries and had highly subsidised publicly owned industries focused in urban areas and often provided subsidised food to urban populations. The net result of that was over time to cut off inward investment, failure to get access to modern technology, often highly priced rather shoddy goods produced locally and often low prices for food for urban dwellers but very low prices to very poor rural people. Actually the poorer countries did badly out of that model. If you are starting to unravel all of that, which you need to do to get the kind of economic growth which will lift up the poorer countries, there will be a lot of change. There will be a lot of people working in non-viable industries, there will be highly subsidised food for urban populations. You have to change all that to get the country on some viable path of continuing development and improve life for the rural poor, but you need a process which enables the urban populations which have worked in industries which are going to close down to get some retraining, some credit, some chance to work in another enterprise. If food prices are going to become realistic so that rural populations will grow more food and increase access to food and their incomes, then that needs to be phased in a way which becomes feasible for the urban population. You must not prop up an old order which is preventing development, but you need to assist those which have to change in order to get better development to be part of the process of change and get some benefit from them rather than adjust by brutalism and just sweep people into unemployment and misery and allow the economic change to come through but at great human cost. This is a lesson for a country like this too. A lot of deep change is taking place in the global economy and we are seeing some sectors of our population losing jobs and seeing change even though there are lots of new jobs in the economy. Similarly people need chances to retrain, to get jobs in the new sectors as old sector jobs fall away.

  10. Would DFID finance that transitional phase? Would DFID help those who are having to be retrained, those who are being made redundant because of the changes?
  (Clare Short) The model of development we are advocating would not have the UK and the Department for International Development separately parachuting into a country and saying they ought to engage in these reforms and we will help this particular group who are losing out to adjust. We would be hoping there would be a poverty reduction strategy type approach in every country where the Government has a clear plan for its macro-economic policy and the spending of all its revenues, so it plans its economic growth, it sees the sectors where there are going to be improvements. If that is going to lead to redundancies it has plans to protect people and give them retraining and so on and so forth. We as a government and the World Bank and other development agencies would come behind the government plan and make resources available which enables the Government to manage all those changes. Yes, but in a way which is led locally rather than us carving out a little bit of the change and saying we would fund it. It is governments which need to manage these kinds of changes for themselves and they will need external resources in order to be able to make the change in a way which protects people rather than marginalising and impoverishing them.

  11. This goes back to the poverty reduction strategy papers which all countries are now having to produce in the HIPC area anyway but presumably in other areas as well.
  (Clare Short) That is right and it is becoming a model for the way of working beyond the HIPC area. Bangladesh is currently working on a poverty reduction strategy but in other countries like India, for example, which is not, it is an approach. It might then take on a different name, but we need to pursue everywhere so that development assistance is not lots of separate projects, but the resources are brought together behind local leadership which enables the process of reform and the building of sustainable government systems which will provide education for all, health care for all, economic growth which benefits all, assistance to people who are having to change their jobs because of some of the economic change which is taking place and so on. These need to be universal government-led systems in developing countries.

  Chairman: The changes in trade, which I have no doubt Mr Batt helped you with, are really rather crucial to this, are they not? They are going to cause a great deal of disruption.

Mr Rowe

  12. Just to link with what we have been talking about, quite a lot of groups, trade unions, academics and so on, have criticised your reading of the evidence by the Government in linking growth to poverty reduction as highly selective and we have been asked whether the Government has any intention of letting the research on which you based your White Paper be available for academic discussion.
  (Clare Short) It is all already available and serious academics know that. Any academic who is saying it is not available when it is widely available, being read and used and has been commissioned from very respectable sources, is not a terribly good academic.

  13. They are the ones who have time to write to us. The British Consultants' Bureau have been quite supportive really of your untying aid but at the same time very concerned that other countries will not do the same thing, which would put them at a disadvantage. Do you have any plans to put pressure on other countries to follow suit?
  (Clare Short) Absolutely and I agree with you. There was a little sort of critical explosion in the Evening Standard but apart from that there has been a very positive and mature attitude in the UK compared with other countries who very much view their development budget as a way of promoting their own business and then you get distorted development objectives when countries are seeing their development budget in that way. It should be noted that lots of other countries think Britain is so in favour of untying because our consultants are of such high quality that they will take over most of the international work. That is the reputation of a lot of the people working out of the UK. Yes, we are not doing this in order to get some advantage for the UK or against the UK. Development resources cannot be as effectively deployed as they could be into the budgets of governments thus forcing us to improve governments' own financial management and procurement systems and build real capacity in developing country governments. If different countries are saying the consultants have to come from our country and the vehicles which are being ordered have to come from our country, so some poor country which has a health system with some vehicle supplies has three French vehicles, two German vehicles, three British vehicles all with different spares, it creates enormous inefficiency. If we want quality effective use of development assistance, we have to untie and build capacity in-country so people can run their economy and their government systems more effectively for themselves. We have been working for years and years in the Development Assistance Committee of OECD to get an agreement on untying. Mr Manning had hair all over his head when we started on this. We are pushing very hard currently that everyone should untie their development assistance to start with to least developed countries. It is very difficult. There are some very entrenched bad practices out there. We are still pushing there and we are hoping there might be a push out of a UN conference on least-developed countries which is going to take place and that the least-developed countries will ask us please to untie our aid to them as it enables them to use it better and more effectively. The second whole range of questions is EU tying. Our legal advice is very clear that it is a breach of the EU's own law and ActionAid has been campaigning very well and very effectively on this issue. We really need to put pressure on the Commission to require all countries to untie their aid and that is 60 per cent of worldwide ODA and any EU Member State which is not untied is in breach of law to which they have signed up. We ought to be able to get progress there. We are determined to push very hard in the multilateral system and also invite other countries to do what we have done and get on with it and untie.

  14. I am delighted to turn to the EU, which we have heard in the World Bank seminar today is still extraordinarily sluggish. Your White Paper says that the everything-but-arms initiative should give a great boost to developing countries but since it was written it has been watered down quite a lot; some NGOs even talk about everything-but-farms. Do you feel that the watering down will simply confirm the developing countries in their belief that the EU is irredeemable or whether you think that there is more to it than this?
  (Clare Short) It still has not been watered down; it is all to play for. We have some really strange forces at work. There is a very big campaign by the British sugar industry and we all understand the difficulties farmers have been through. They are a group which needs help to adjust to change in our own country. Clearly change is coming to them and for them to use their distress to block improved trade access for the poorest countries in the world will not remedy their problems: it is to misuse their concern about the change they are having to adjust to. The other big lobby has been from the ACP countries, and particularly the Caribbean which similarly has guaranteed quota entries to the European market which are under question anyway. It was agreed in the Lome« renegotiation that there would be duty-free access for essentially all goods from least developed countries by 2005 and the ACP countries had already signed up to that. There has been a very strong campaign coming out of the Caribbean opposing everything-but-arms. We are still trying very hard to hold everyone together, to continue to support Commissioner Lamy who has driven this forward with very strong support from Commissioner Nielsen, of course to put in place assistance, particularly to Caribbean islands with the adjustment process they will have to go through, but it is coming to them anyway. It is not settled and there are pernicious forces out there who want to scupper the proposal or weaken it or lengthen the phase-in periods and make it less beneficial to least-developed countries. All the forces of decency need to combine and make sure that it is carried through. I repeat: the least-developed countries are 0.4 per cent of world trade. They are the poorest countries in the world where some of the poorest people in the world live. If we can give them a bit better trade access then they will be able to grow their economies a bit more and improve the life of their people. Surely the European Union can open its markets to these very frail economies. They are not going to produce masses of exports overnight because the economies are too weak to do so. It is all to play for.

Mr Colman

  15. I should like to ask some questions about the absence from the White Paper of any meaningful discussion of the General Agreement on Trade in Services (GATS). I wondered why it had been left out. Interestingly enough, in the submissions which we have received, we have received one from the World Development Movement (WDM) and another one from British Invisibles, from either end of the spectrum, asking why this was left out and particularly all of us as parliamentarians have been lobbied over recent weeks saying that the World Trade Organisation is forcing on developing countries this particular agreement to open up their markets. Given this concern, you have mentioned the Commission on Intellectual Property Rights which you will be backing, but why have you not perhaps proposed a similar comprehensive and independent impact assessment of the liberalisation of service sectors on the poor?
  (Clare Short) This is another area of mythical campaigning. What the General Agreement on Trade in Services provides, which was negotiated during the Uruguay Round, is that countries will open up whichever services they choose at whatever pace they choose, bottom-up approach. In fact the WDM is totally misleading and totally misinformed. It is not just here, it is across the international system. The Seattle-style protesters suggest that the WTO is making everyone privatise their higher education in the UK and so on. Complete, absolute misleading nonsense. That is not provided in the agreement at all. In fact about seven per cent of services have yet been opened up. If you go to developing countries, as members of the Committee will know, some of the opening up of banking and so on is leading to better quality banking, better regulated banking, people being able to get credit in order to have little businesses, opening up insurance, financial services, accountancy firms, lots of developing countries need much more effective accountancy capacity, better regulation of banks and so on, opening up some of those sectors which many countries have done has been wholly beneficial to get more effective economic management in order to improve the performance of the economy.
  (Mr Batt) There is mention of this in a couple of places in the White Paper of trade in services. One is in paragraphs 130 and 131 which refer specifically to GATS and to movement of people which is one part of trade in services. It is a dimension of this which is of particular interest to developing countries. Later on in the paper, in paragraph 235, where the paper talks about the composition of any future round of multilateral trade negotiations, it actually mentions the opening of service sectors as one of the areas to be given high priority.
  (Clare Short) Again another set of people who are so busy writing to you that they did not manage to read the White Paper first.

  16. It certainly caught me out as well. British Invisibles have said, and I agree with your analysis of the situation, that they would have thought that more would have been made in the globalisation White Paper of the particular importance of sectors, of financial services, telecommunications and power distribution which come within this.
  (Clare Short) The whole question of telecommunications is dealt with elsewhere and we give these very worrying facts: there are more internet connections in New York than in the whole of Africa; Africa is the most expensive place in the world to be connected to the internet because there has been no liberalisation of telecommunications. They tend to be government owned, very high prices, no investment and there have been massive technological changes in telecommunications, as everybody knows. That is in there; paragraph 121. There is also a reference to the public/private infrastructure advisory facility where we work very hard with the World Bank to get a facility so that governments have support with putting in place regulatory arrangements, doing feasibility studies, really increasing investment in infrastructure by making appropriate partnerships with the private sector. All of that is in there; paragraph 251.

  17. Yes, I have that one. Just to prompt your officials, the Commonwealth Business Council has actually set up a public/private partnership working group for delivering just this. This is very important paradigm. Is there something you would suggest the World Bank should pursue as an alternative to privatisation of services going forward into the future?
  (Clare Short) No. We have already been instrumental in setting up with the World Bank a facility which is on the ground, opened in southern Africa and east Africa and a rolling programme of these offices opening. We have put finances into it, as has Japan and other countries. It is currently helping governments come to it for advice saying they need more investment in infrastructure, say in the telecom sector or in electrification or whatever, how can they get advice on getting private sector interests and making regulatory arrangements or doing some of the work the public sector needs to do to make these kinds of investment feasible. Water, sanitation, all these sectors. It is out there and running and the last time I looked at the number of enquiries which had been made a very considerable use was being made of the facility already.

  18. The World Bank has already moved off privatisation as a nostrum and onto PPP.
  (Clare Short) No. Privatisation is not a nostrum. I do not think anyone should approach these questions ideologically. We should all be looking for efficiency, services for people and reduction in poverty. For example, in India we have been highly involved with the bank in the restructuring of the electricity sector in Orissa and Andhra Pradesh and these reforms are going on across India. You have publicly owned electricity, very, very highly subsidised, providing cheap irrigation to quite well-off farmers, power cuts all over the place because no-one will invest in the sector because it is so highly subsidised there is no rate of return. Poor people getting no service whatsoever and it is sucking away from state budgets all the resources which ought to be going into health care and education. We then will engage in helping the process of reform, because India will get better electricity services which it needs to grow its economy but our major and overwhelming interest is to release those resources which ought to be being spent on health care and education. Across the world there are lots of publicly owned industries which are wasteful, inefficient, highly subsidised, where you could get more investment in infrastructure by privatising with good regulatory arrangements so you do not get any abuse or misuse of public resources. We pragmatically support, as does the Bank, those kinds of reforms where they bring benefits to people. That is one whole set of agendas. Then how to get new massive scale investment in infrastructure, which is needed, water, telecoms, electricity, transport, in order to speed up the development and include the poorest in access to modern resources, the public sector cannot afford enough. We need to get partnerships with the private sector to get the investment to the sort of scale which is needed in Africa and south Asia.

Mr Khabra

  19. I am concerned about this new trend and desire on the part of the developed countries to recruit skilled labour from developing countries. You know that the Home Office is considering proposals to make some changes in the immigration rules and DTI is also involved. The White Paper does acknowledge both advantages and disadvantages of developed countries recruiting skilled staff from low and middle income countries such as India or any other: "for developing countries, these outflows of skilled people generate significant remittances". I do not agree that it does actually generate significant remittances back to those countries. I do disagree with that. "Longer-term benefits may include the new skills and contracts brought back by the returning migrants". There is a contradiction here. When you are already recruiting skilled people from other countries, where those countries are trying to develop further advanced technologies to train their own people, and we say that we are recruiting them here and then they will take back those new skills back there, I think there is a contradiction. The Department is entrusted with investing money in developing countries to create conditions over there to let the people have the opportunity to acquire new skills. There is something wrong here in this policy that the countries which are trying to keep their own skilled force, with a country like India, huge developments taking place, expanding economy, they need more skilled people, and here we are trying to recruit people and drain them of their own skills. For me this whole thing is missing in the White Paper and this issue has not been taken up seriously. Has the Government reached any conclusions on this issue? What is the policy of the Government on the recruitment of staff? Have you personally been involved in this new proposal that we should recruit skilled labour from abroad?
  (Clare Short) Yes. You can say you do not approve, but you cannot say it is not true that it generates remittances. Migrants generate over $70 billion of remittances; it is more than worldwide ODA. It is just a matter of fact. If you go to Silghat, Londa or wherever you will see some of the consequences of that sort of intermovement and some of the remittances which go home. There are remittances. There are also great pressures to migrate and some of it is very worrying; I agree with you. I have been told that there are more Ghanaian doctors in New York than in Ghana. There are more Ugandan doctors in South Africa than in Uganda. Of course if you take Sierra Leone, a country which was destroyed and plundered, most of its educated people left the country because there was nothing they could do with their skills in the country. They must have that freedom. When there are conditions where they are unable to work you cannot say in no possible circumstances can people migrate. There is no doubt that people working abroad for a number of years and coming home again can often bring new skills and knowledge back to their country. We all know that. People moving around the world learn from each other and generate more skills and knowledge and that can be beneficial. For example, Bangladesh, as a matter of policy, trains more doctors than it needs in order that they will be able to migrate. Whatever view you take of that, that is a policy decision of the Bangladesh Government. In the case of India its IT specialists are all over the world and there is a massive IT industry in India itself which is leading to great forces for reform and confidence in India about the capacity it has and the way in which it can grow its economy and use its trained people. There are references in the White Paper also that to have real freedom to trade in services people who often carry the skills of a service have to be able to migrate temporarily, for short periods of time, in order to be able to sell their service to another country. This is a matter of great concern to developing countries that very strict immigration restrictions prevent them from having the ability to trade in services. There is a special working party in the WTO on that matter and we make some sympathetic references to that. In my view, some of what you said went too far in damning all migration and movement of people and trade in services, but I agree with your fundamental point that it would be outrageous if countries like the UK just go out unselectively to recruit the skilled people they need regardless of the need of the country concerned. I do not know whether it was Frank Dobson who brought it in—I do believe it was—but the NHS has put in some restrictions on its recruitment that it has to look at the skills needs of the countries in which it is recruiting and make sure that it does not go out denuding countries which have very great shortages of skilled health workers in order to recruit here. That is the position we adopt in the White Paper. There has to be some freedom of movement of people but we have to protect the skills base of developing countries. As a country we cannot ourselves, and nor should we as a matter of international policy, be sucking away the skilled people from developing countries who need more people with skills. We have been consulted and there are words to that effect in each of the Government's statements which are made. I agree with you. That needs interpreting in practice. You could say the right things and not do the right things.

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