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Baroness Chalker of Wallasey: My Lords, I am grateful to all noble Lords who have spoken in this short debate. I shall do my best to answer the questions posed, starting with the noble Baroness, Lady Blackstone. Having welcomed the orders, she first asked me whether there were similar agreements for other republics and what was the timetable. Perhaps we may just look at the signing of the partnership and co-operation agreements. They have been signed for Russia, Ukraine, Belarus, Moldova, Kyrgyzstan, and Kazakhstan. For Uzbekistan, the EU opened talks last month; for Turkmenistan, the possibility of talks is being examined; for Tajikistan, at present there is little chance of a partnership and co-operation agreement, but let us hope that it will put its house in better order, and one such chance may come. We expect signature for Armenia, Georgia and Azerbaijan to take place this month. So that is the state of similar agreements.

The noble Baroness then asked me about the main criteria for the agreements. The main features are obviously that there should be political dialogue at ministerial, parliamentary and official levels; that there should be closer trading links, in particular, through the mutual abolition of quotas on most goods; most favoured nation treatment on tariffs; the abolition of discriminatory internal taxes. The Belarus and Moldova agreements allow for talks in 1998 about eventual free trade areas.

The third feature relates to the provisions on parties doing business in one another's territories, including the terms upon which companies may set up, the regulatory framework for investment and helping to bring the Belarusan, Moldovan, Kazakh and Kyrgyz practice into line with the EU, for example, on competition and intellectual property.

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The fourth main area is that there should be continued economic co-operation under the TACIS programme, to which the noble Lord, Lord Thomson of Monifieth, has just referred. I shall return to that issue in a few moments.

There are slight differences in the four agreements, but on the whole they are largely similar. The differences that exist are textual ones reflecting the different negotiating priorities of the four countries. For instance, each country had its own list of goods to be exempted from the requirement to grant most favoured nation treatment. In areas where the MFN treatment applies, the EU and the other party give each other the same trading advantages that they accord to all other countries to which they grant MFN treatment.

On substance, the Belarus and Moldova agreements contain an evolution clause, offering a review in 1998 of the possibility of a free trade area. There are no social security provisions in the Kazakhstan and Kyrgyzstan agreements. All EC goods imported into Kazakhstan and Kyrgyzstan will be free of quotas and equivalent measures. For EC imports into Belarus and Moldova, exemptions for such restrictions will apply to goods other than textiles and coal and steel products.

There are some differences between these four PCAs and the Russian and Ukrainian PCAs. Russia and Ukraine are similar to Belarus and Moldova for the obvious reasons that they have had a similar situation, but only Russia and Ukraine PCAs provide for a dialogue at the highest level; that is to say, at presidential level. The Russian agreement, which is not before us tonight, contains some transition periods which take account of its special relationship with the rest of the CIS.

On the further questions asked by the noble Baroness, let me explain that the reason there is a French declaration at the end is that there is no need for the French overseas territories (the DOM/TOMs) to be bound by the PCAs. That is all that is meant by that.

The noble Baroness then asked why Austria, Finland and Sweden do not appear to have signed the Moldova PCA. That was because the Moldova PCA was signed on 28th November 1994, before those three countries acceded to the EU. I can assure the noble Baroness that Austria, Finland and Sweden agreed on their accession to take on the obligations that apply under the PCAs.

The noble Baroness asked me about monetary policy articles on Belarus and Moldova, but not on Kazakhstan and Kyrgyzstan. I wish to look into that a little more than I have been able to while listening to other noble Lords. I shall write to the noble Baroness and others who have spoken with a full explanation. I can assure the noble Baroness that there is nothing sinister about it.

The last question that the noble Baroness asked me was about the reasons for the GATT differentiation. I believe that she is aware that all agreements contain references to the GATT, including the further development on accession. There are no real differences. I can read her a long explanation of the whole of the WTO arrangements. Obviously the PCAs can be amended to take into account accession to the WTO. There are different situations for

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each of them. The UK, however, welcomes the prospect of all these countries eventually becoming members of the WTO on the basis that they apply and that they then respect the WTO's rules.

As far as I know, the progress being made is normal for each of the countries. If the noble Baroness would like a note of that, I suggest that I put it in my letter to her rather than detain your Lordships now.

The noble Lord, Lord Lester of Herne Hill, returned to a common interest that he and I now definitely share about getting better explanations to your Lordships in advance of debate. May I assure him that explanatory memoranda are submitted on all PCAs. That is part of the normal scrutiny procedure. I must apologise if he did not know that for these four agreements the committee scrutinised the explanatory memoranda in 1995. I cannot tell him exactly when in 1995 that was, but they have been through the process. He knows full well that he and I believe in this process and that it is already working well for PCAs.

My noble friend Lord Finsberg asked me about Moldova, in which he has taken such an important interest as the leader of the group on the Council of Europe. I understand that he is puzzled about what can be done over Transdniestia. We obviously hope that there will be an early negotiated settlement to the dispute which takes account of the independence, sovereignty and territorial integrity of Moldova. We have warmly supported Moldova's efforts since independence to introduce and sustain reform. We have no reason to doubt Moldova's commitment to fulfilling her obligations under this new agreement, but, as my noble friend made clear, there is plenty of action going on through the OSCE at present to try to resolve the Transdniestia dispute. I believe that that is the way in which to proceed with the matter. It does not invalidate putting the PCA forward to your Lordships tonight.

The noble Lord, Lord Thomson of Monifieth, told us about the importance of auditing what goes on and we will accept that. He went on to talk about the TACIS and PHARE programmes. The TACIS programme relates to these particular orders. His kind comments about the know-how funds and the officials running them are very much appreciated. In 1989, when we introduced the funds, the procedures were experimental. However, as he realised, we had the benefit of many years of experience of technical co-operation in other parts of the world which we put together with new experience of the former Soviet Union countries and the central and eastern European countries. We now see that the British know-how funds are almost a role model for others. We cannot impose our procedures on others but I believe that increasingly the programmes run by the European Union are taking a lesson out of a good housekeeping book. Certainly the PHARE programme has improved considerably and adopts a number of techniques that we have used during the past six years. I hope that the TACIS programme will become a great deal more flexible because my experience is exactly that of the noble Lord, Lord Thomson of Monifieth.

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Perhaps I may respond to the noble Lord's comments about the charity know-how funds. During my somewhat limited travels in the former Soviet Union I have found that the idea of helping oneself by charitable or non-governmental efforts is catching on fast. Therefore, anything that the charity know-how funds can do to aid that process reinforces the efforts which are being made initially in small ways in many different areas. That process is many light years away from the experience of the former Soviet Union.

I have sought to explain the matters which were a little less clear. I shall write to the noble Baroness, Lady Blackstone, and copy my letter with extra detail to other noble Lords who have spoken today. It is necessary to move each order individually. I believe that the PCAs will offer substantial encouragement to the process of reform in the four countries. That is in the interests not only of the countries themselves but of the United Kingdom and the European Union as a whole. I commend the order to the House.

On Question, Motion agreed to.

European Communities (Definition of Treaties) (Partnership and Co-operation Agreement between the European Communities and their Member States and the Republic of Moldova) Order 1996

7.24 p.m.

Baroness Chalker of Wallasey rose to move, That the draft order laid before the House on 29th February be approved [13th Report from the Joint Committee].

The noble Baroness said: My Lords, I beg to move.

Moved, That the draft order laid before the House on 29th February be approved [13th Report from the Joint Committee].--(Baroness Chalker of Wallasey.)

On Question, Motion agreed to.

European Communities (Definition of Treaties) (Partnership and Co-operation Agreement between the European Communities and their Member States and the Republic of Kazakhstan) Order 1996

Baroness Chalker of Wallasey rose to move, That the draft order laid before the House on 29th February be approved [13th Report from the Joint Committee].

The noble Baroness said: My Lords, I beg to move.

Moved, That the draft order laid before the House on 29th February be approved [13th Report from the Joint Committee].--(Baroness Chalker of Wallasey.)

On Question, Motion agreed to.


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