Government urges trade shake-up

Ms Hewitt set out the government's vision for UK trade

The government has unveiled a new direction for the UK's trade policy - and an attack on EU and US tariffs.

Trade and Industry Secretary Patricia Hewitt called for an end to subsidies, dubbing them bad for business, the global economy and developing nations.

Ms Hewitt's white paper has been billed as a bid to boost the UK's reputation as a free trading nation.

But the minister risked a fresh row with trade unions by backing UK moves to outsource jobs overseas.

Ms Hewitt claimed that sending jobs abroad to places like India helped companies become more efficient, while aiding developing economies.

Reforms urged

As part of its "pro-development" approach to trade, the government proposals urged countries to open up their markets to developing countries.

"Poorer countries should not be expected to pay a price for any concession on subsidies, tariffs or market opening by a developed country - as trade negotiators too often imply," Ms Hewitt said.

"Developed countries should make reforms willingly because all have something to gain."

The white paper, "Making Globalisation a Force for Good", also called for further reforms of the EU's agriculture policy.

Proposals set out in the white paper include:

• Investment in education and skills so that UK workers are able to compete in a modern high-tech economy
• Encourage the EU to take a leading role in multilateral talks and to improve the openness of its market
• Continue to call for structural and economic reform within the EU
• Use UK trade and investment and the Export Credit Guarantees Department to support international business dealings

Oxfam welcomed the proposals as a "step away from market fundamentalism" and a "robust commitment" to opening up the UK's markets.

Over the last 10 years many of the world's poorest countries have liberalised trade substantially without realising any of the alleged benefits Tim Rice, ActionAid

But the group also criticised the Department of Trade and Industry, saying it needed to go further than "just asking companies to behave nicely".

It attacked proposals on drugs patents and a lack of regulation of outsourced jobs.

"The real test is whether the policy and principles outlined in the paper are put into practice," Justin Forsyth, director of policy said.

'Nothing new'

Fellow charity ActionAid's reaction was also mixed: praising its opposition to protectionism, but attacking its failure to tackle "abuses" of third world countries by both the EU and huge global corporations.

"Over the last 10 years many of the world's poorest countries have liberalised trade substantially without realising any of the alleged benefits," trade policy officer Tim Rice said.

The White Paper makes it clear that the Government is still addicted to liberalisation as a cure for all ills Andrew Pendleton, ChristianAid

He also called for binding regulation for big companies as "the voluntary approach to corporate social responsibility has been totally inadequate".

Meanwhile, Christian Aid's senior trade policy officer Andrew Pendleton said the paper offered "nothing new".

"The White Paper makes it clear that the Government is still addicted to liberalisation as a cure for all ills."

He also attacked the paper's lack of concrete suggestions for UK government action, dismissing it as "not a radical new agenda to make trade work for development, but a free trade agenda with add-ons".