That the Grand Committee takes note of the Trade Agreement between the United Kingdom and Japan for a Comprehensive Economic Partnership, laid before the House on 23 October (16th Report from the European Union Committee).
My Lords, this debate is on the UK-Japan trade agreement, on which the International Agreements Sub-Committee reported last week. I shall provide a summary of its key findings, but the debate is also an opportunity to talk about the process of scrutiny with a test case before us. It is a novel process, and we can draw some initial conclusions about what works well and what does not. I trust that Members will permit those remarks about the bigger picture. I look forward to the debate and to hearing what noble Lords will say; I look forward in particular to the maiden speech of the noble Lord, Lord Darroch of Kew, about which more will be said later.
The report is the culmination of months of talking to stakeholders and discussing negotiations in confidence with the noble Lord, Lord Grimstone, who is in his place today and has been generous with his time—I thank him for that on behalf of the committee—and senior officials, including the chief economist and the chief negotiator. We also spoke to and corresponded with the Secretary of State before the summer.
The International Agreements Sub-Committee has sought to work in a complementary fashion with the Commons International Trade Committee, whose report on CEPA largely concurred with ours. The report principally contrasts CEPA with the JEEPA—the Japanese-European agreement that existed and still does—looking to understand impacts of any deviations and what stakeholders wanted the Government to achieve. Parliamentary scrutiny is a second route for their concerns and ambitions to be heard, and we tried to do justice to that evidence base in our report.
Where appropriate, we have considered the Government’s published objectives, but they are, to be frank, generic, and the Government have not cross-referenced CEPA with those published aims to set out whether all of them in their view have been effectively met. Parliament is not involved at the moment with that objective-setting process. We can say after the fact whether we think that they got the objectives wrong and what other objectives might have been sought, but our role here is severely limited. That is a matter which the House may wish to think further about.
We have also evaluated the Government’s final claims about what CEPA achieves and what it does not. Our principal conclusion in this regard is that the Government have oversold several provisions in a way that risks undermining what is ultimately a respectable continuity-plus agreement.
Looking at our specific key findings and starting with the successes, we note that CEPA goes beyond JEEPA in some of its digital and data provisions, which is welcome. This will benefit UK and Japanese businesses across sectors, in particular those in service industries. Those provisions have found favour with many of our witnesses, such as the City of London Corporation and the Motion Picture Association. However, some others, such as the consumer organisation Which?, and the Open Rights Group, have asked whether CEPA’s provisions might indicate a change of thinking from the Government about how to ensure the protection of personal data. Overall, we did not view CEPA as creating a potential personal data protection loophole, but we would be interested to hear from the Minister whether the UK envisages diverging from the EU on data protection.
My Lords, I welcome the opportunity to debate this report. I have the privilege of serving on the International Agreements Sub-Committee and the rapid production of such a comprehensive report is due in no small part to the skills of our chairman and those of the clerk to the committee, Dominique Gracia, and her team, who have done a brilliant job pulling it together in such a constrained timetable.
In the limited time we have available for debate, I want to focus particularly on the data provisions in the agreement, how we use trade agreements to advance decarbonisation and the importance of building trust in trade policy.
First, on data provisions, the IAC received evidence from Dr Emily Jones and Beatriz Kira, of the Blavatnik School of Government at Oxford, which raised a number of concerns. In particular, I hope the Minister can tell us more about the decision of CEPA to expand the scope of protection of mandatory disclosure of source code and software beyond that in the EU deal to include algorithms expressed in that source code. Will the Minister tell us in his response the reason for that expansion, which is a matter of concern given the impact that algorithms can have on decision-making and the need for this to be transparent to the public?
Secondly, as the noble and learned Lord, Lord Goldsmith, has said, while it is welcome that the agreement retains the references in the EU deal to international environmental commitments, including the Paris Agreement, and commits both parties to working to secure mutual environmental aims, it seems like a missed opportunity not to have sought more, particularly on green technologies and services. The impact assessment predicts an increase in greenhouse gases as a result of the treaty, and while in itself it is not a significant increase, we need to think about how we can use trade policy to bring down greenhouse gas emissions, not to raise them—however small the amount may be.
My Lords, I am very pleased to follow my colleague on the International Agreements Sub-Committee, the noble Lord, Lord Oates, and our chair, the noble and learned Lord, Lord Goldsmith, who has so well set out the basis of our report that I will not follow him in most of that. I will focus on what I think is really important, which is that this is a continuity-plus agreement. I want to focus on the plus, which I think is more significant than people have perhaps yet realised.
I declare an interest. In addition to being a member of that committee, I am the UK chair of the UK-Japan 21st Century Group, which was in online conference with our Japanese colleagues on 11 and 12 September this year, when the agreement was signed. Among our colleagues from Japan were seven members of the Japanese Diet and former Ambassador Tsuruoka, who will be known to a number of Members.
The sense of positive welcome given by our Japanese colleagues to the agreement reflected their view that this was not simply a rollover of the EU agreement—although much of it might look that way—but presaged a significant broadening and deepening of the UK-Japanese trading relationship. I will focus on that. First, on digital trade, I think the EU, because of its lack of a digital single market, continues not to enter the kind of expansive agreements available with other countries. This agreement much more nearly reflects the content of the CPTPP, the Trans-Pacific Partnership Agreement: things such as free flow of data, net neutrality, consumer protection online, no data localisation and more open government use of anonymised data. All of those are really important for digital trade, and the United Kingdom is a world leader in digital trade. For us to have such agreements is increasingly important.
That is also true on financial services, where the lack of potential agreement in the EU-UK agreement is a matter of continuing regret. Here, with Japan, are some starting points much welcomed by the City on facilitating UK firms licensing in Japan, on regulatory co-operation and reference and deference to each other’s regulatory structures and, generally for service industries, the mobility of staff and their families to work in Japan.
My Lords, I am sure that all of us welcome this trade agreement—the first post-Brexit trade agreement—and may many successful agreements follow. However, it is being scrutinised under the so-called CRaG rules, and it illustrates the limitations of that system with respect to parliamentary scrutiny, as was emphasised by the noble and learned Lord, Lord Goldsmith, in his opening remarks. There has been no input into negotiating mandate or oversight during negotiations, no proper involvement of devolved Administrations and no guarantee of a vote at the end of the debate. There has been very limited time for consideration by parliamentary committees.
For all those reasons, I welcome Her Majesty’s Government’s recent agreement to not only set up but extend the life of the Trade and Agriculture Commission for at least three years and to require the Secretary of State to lay a report before Parliament with regard to free trade agreements involving agricultural products, explaining their consistency with UK statutory protection in relation to human, animal and plant health, animal welfare and the environment.
Returning to this UK-Japan agreement, I shall focus on my particular interest in standards of food products, animal welfare and the environment. We were assured by the noble Lord, Lord Grimstone, in a letter of 11 September that, with reference to the Japan agreement,
“we have maintained all existing protections for our high standards of … animal welfare”.
How will we ensure that imported food products have been produced to standards no lower than our own, and who will do that? I ask that in the knowledge that the World Animal Protection ratings for animal welfare in general are E for Japan compared to B for the United Kingdom; and for farm animal welfare legislation, G for Japan, lower than the UK’s rating of D. Japan has no specific legislation on animal transportation, the rearing of pigs, laying hens or chickens, and it still permits sow stalls and conventional battery cages for chickens—all in contrast to the range of legislation on these subjects applicable in the UK and to our UK farmers. Furthermore, it is not clear how many of the 14 farm animal welfare guidelines of the World Organisation for Animal Health—the OIE—Japan has put into law. Of global significance is the fact that there is no reference in the agreement to antimicrobial resistance or measures in Japan to reduce antibiotic use in farm animals. In fact, in general, there is little reference to animal welfare standards in the UK-Japan agreement.
My Lords, I look forward very much to the maiden speech of the noble Lord, Lord Darroch, with whom I worked very productively when I was Europe Minister and who has the great virtue of being a Chelsea fan.
The EU-Japan agreement, from which the UK, as an EU member, has benefited, entered into force on 1 February 2019 and is the world’s largest bilateral trade deal, creating an open trading zone covering nearly one-third of global GDP. In his evidence to the International Agreements Sub-Committee, the Minister, the noble Lord Grimstone, confirmed that this new agreement with Japan is a “continuity” agreement. His departmental colleague confirmed that
“in almost all respects the tariff liberalisation is the same as it is in the EU agreement”.
It is therefore surprising, perhaps, as the noble Lord, Lord Oates, pointed out, that the Secretary of State, Liz Truss, called the agreement a
“ground-breaking, British-shaped deal”,
which she said went far beyond the existing EU-Japan trade deal. On 19 November, when questioned by the shadow Secretary of State, Emily Thornberry, she was unable to explain how this was the case, and has failed to produce any economic modelling to prove otherwise.
A government impact assessment in October found that the £15.66 billion projected boost to bilateral trade claimed by the Government was, in fact, a comparison with no trade deal with Japan, rather than with the existing EU-Japan deal. It also showed that of these benefits, 83% would go to Japanese exporters and only 17% to the UK’s. Officials confirmed that the deal was expected to add a mere 0.07% to UK gross domestic product, and this was again as compared with no deal with Japan, rather than with the status quo EU-Japan deal.
The UK had sought access to tariff-rate quotas for value-added agri-food exports such as cheese. As the Japanese had promised their farmers that there would be no such new quotas, Britain failed to secure these, and instead has to use any quota left over by the EU in only 10 out of 25 such products covered by the EU-Japan agreement. Moreover, the UK Trade Policy Observatory found that all the tariff “wins” claimed by the Secretary of State are for goods that the UK does not actually export to Japan. The 10 products concerned include obscure items such as birds’ eggs, raw hides, fur skins, and ultra-strong spirits of at least 90% alcohol. The gain to British exporters was therefore found to be “zero”.
My Lords, as a relatively new member of the IA committee, I have been impressed by the expertise of fellow members; by the skill and professionalism of the committee staff, to whom great credit must go for this report; and by the dedication and, above all, patience of our chairman, the noble and learned Lord, Lord Goldsmith.
Whatever the merits of the Government’s claim that the Japan deal is more than a rollover of JEEPA, it should be welcomed as providing
“valuable continuity for businesses, consumers and other stakeholders”,
and as a stepping stone to joining the CPTPP. But it is nowhere near as ambitious as many had hoped. Agreement to negotiate a deal was not reached until January last year, but it was a further 17 months before negotiations even began, so they had to be conducted at pace. I congratulate our negotiators on what they were able to achieve in such a short time, but it meant that nothing that required any change to primary legislation in either country could be included. Hopes for an ambitious deal were dashed and many proposals from consultees had to be ditched, calling into question the claim that this is a comprehensive deal.
Indeed, as other noble Lords have already pointed out, there are several examples of the Government overselling the deal. I hope that the Minister will accept that criticism. I note also that the UK’s overselling is in marked contrast to the Japanese who, despite appearing to gain far more from the deal than we do, have been much more muted. But working out those gains is difficult given current limitations in economic modelling and because, unhelpfully, the Government have compared the deal against trading on WTO terms rather than against JEEPA. I hope that this will not be the case in future deals.
Operating on a compressed timetable reduced ambition, but it also meant confusion and disappointment for the numerous stakeholders. The intellectual property chapter provides a good example. Of those aspects impacting the creative industries, our report says that, despite government claims of significant improvements on JEEPA,
My Lords, I welcome this trade agreement, not only because it secures the benefits of the existing EU-Japan free trade agreement. It goes beyond that, especially in digital and data, and, potentially, on geographic indicators and rules of origin, and it helps to pave the way for our future membership of the TTP, or the CTP—you know what I mean.
Before elaborating on those aspects, I repeat my habitual warning, like a cracked record, about the excessive importance attached to trade deals in public debate in this country and, indeed, in your Lordships’ House. Trade agreements like this are useful but far less important than most people imagine. What really drives trade is producing goods and services that people want to buy then getting out and selling them, preferably aided by a competitive exchange rate. Sadly, a significantly lower proportion of British small and medium-sized enterprises engage in international trade than is the case for similarly sized companies in our major competitors. That weakness in our business culture has been exacerbated by an exchange rate sustained at an uncompetitive level by the sale of assets, rather than by selling as much goods and services as we import.
This agreement with Japan is sometimes belittled, not just relative to the existing EU-Japan agreement but because it is not nearly as deep as the single market arrangements that we are leaving at the end of December. It is the accepted wisdom that the European single market represents the most comprehensive and deepest trade agreement that exists, whereas the WTO is treated as of little fundamental importance. I happened to be the Secretary of State for Trade and Industry who had to implement the single market legislation and helped to negotiate the Uruguay round which set up the WTO. Despite the optimistic speeches that I made at the time about how much the single market would boost our exports, we find that, over the ensuing quarter of a century, our goods exports to the 14 countries which founded the single market have little more than stagnated: they have grown by some 18%, barely 0.5% a year. By contrast, our goods exports to the 14 largest countries with which we trade just on WTO terms have grown by 80%—six times as fast—over the same period. As for the impact that either may have had on our GDP, that is almost impossible to assess, even in retrospect; it is certainly imperceptible, looking at the trend in our trade in recent decades.
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Another key area of provisions relates to agri-food products. Those provisions are split through several chapters in our report, but I shall summarise them here together. First, overall, CEPA is useful to UK producers. Tariff reductions and their staging are maintained, allowing UK exporters to continue to be competitive with EU exporters. I do not really want to mention the supposedly cheaper soy sauce—the little incident on Twitter—but Members may recognise that as an allusion to an unfortunate and wrong statement that the deal would make soy sauce cheaper. Our report covers some areas such as trade in malt and tariff-rate quotas because the Government made quite a big deal of them, although they are relatively small in trade terms. Regarding the malt trade, the Maltsters’ Association of Great Britain told us that this agreement
“offers the same benefits as the existing system”—
access to the Japanese market tariff free through Japan’s autonomous tariff-rate quotas—yet the Government have advertised CEPA as delivering “more generous market access”. The Minister might like to comment on that.
Tariff-rate quotas, or TRQs as I will call them, were one of Japan’s key concessions to the EU to avoid greater liberalisation of tariff lines. Japan liberalised 97% to the EU’s 99%. In this UK deal, 94% of Japanese tariff lines are liberalised, to 99% of ours, but CEPA maintains access to only 10 of JEEPA’s 25 tariff-rate quotas, and then only after EU exporters have used them as much as they wish. That creates some uncertainty for UK producers and Japanese importers, who may now need even to provide bankers’ guarantees when importing UK products lest additional duty eventually needs to be paid. That does not make UK goods attractive, and access for the UK via the headroom left by the EU may disappear in only a few years. The Government say that joining the CPTPP will fix this, but that seems a contingent basis for dismissing the difficulties that exporters will face.
Finally, on a matter on which other noble Lords may touch later, there are new provisions for geographical indicators. The Government advertised CEPA as though they had won these protections, but in fact there is still an application process to be completed during which there may be objections from any of the 11 CPTPP countries or other producers.
Turning beyond agricultural and food products, CEPA has significant effects on trade in other goods. We thought particularly and had evidence particularly about automated manufacturing, as that is an area of key inward investment in the UK. Let me be clear: CEPA’s provisions are necessary and therefore welcome, but they are not sufficient. CEPA enables UK and Japanese manufacturers to use EU products and count these as their own for the purposes of cumulation. However, what the Society of Motor Manufacturers and Traders and the North East England Chamber of Commerce told us was most vital was cumulation for products exported to the EU. CEPA cannot deliver this on its own; only the UK-EU deal can, and it seems increasingly from press reports that it is unlikely to do so. I hope that other noble Lords may cover this topic.
The noble Earl, Lord Sandwich, regrettably cannot be with us for debate today, but I know that he would have wanted to highlight the sustainable development provisions of CEPA—the noble Lord, Lord Oates, may touch on some of these issues later. CEPA retains JEEPA’s sustainable development chapter but does not go any further. We were concerned at the lack of focus on environmental goods in CEPA overall. Cornwall Council highlighted in evidence to us the absence of any mention of green technology and the North East England Chamber of Commerce wanted more attention paid to low-carbon goods and services, including renewable energy, which are an important part of its regional economy.
As for the Government’s impact assessment, that itself notes uncertainty about whether CEPA can increase investment fall and the export potential of low-carbon goods and services. Again, I hope that the Minister will say something more about these issues in his speech.
I will illustrate how these issues are all interrelated. The North East England Chamber of Commerce highlighted that the accumulation of Japanese content in UK automotive manufacturing products being exported to the EU was “crucial”, in particular for electric vehicles, as the EU is not well developed in electric vehicle production and many parts come from Japan.
I will say a word about the Government’s explanatory documents. The brief summary of our findings that I have just given indicates the importance of looking closely at variations from the existing Japanese-EU agreement, JEEPA. However, the Government’s impact assessment does not allow us or the public to answer the question of whether the UK-negotiated deal serves UK businesses and consumers better than the existing one. The impact assessment compares CEPA only with no deal with Japan—that is, with WTO terms.
The committee does not want to use this report to relitigate Brexit, of course; that was not the purpose or intent behind that conclusion. However, we think the question is important and that the information to answer it should have been provided. We note that the Government’s own impact assessment of JEEPA estimated a GDP increase of £2.1 billion to £3 billion. That is much more than CEPA’s estimated £1.5 billion boost. We understand that the methodology and context of those two assessments differed, but we believe that the Government should have addressed this issue head on.
Our conclusion is thus forward-looking. For Parliament to best scrutinise the Government’s exercise of their new powers, which will be increasingly important for the country as we develop more new trade deals, we must have the data necessary to judge whether the Government have done a good job.
The Grand Committee previously debated our report, Treaty Scrutiny: Working Practices, and allied reports, when there was significant support for an enhanced mechanism for parliamentary scrutiny of treaties, including trade deals. That has also been evidenced in debates on the Trade Bill, and is likely to feature on Report when it comes about. Our inquiry on CEPA and those on the ongoing talks with the US, New Zealand and Australia—all of which are under way—have all yielded evidence from stakeholders about parliamentary scrutiny processes and their importance. This is not simply Members enjoying an opportunity to talk about themselves, but an important issue that we must get right.
Producing this report has been challenging. It is a testament to the willingness and ability of Members and staff to absorb and consider a vast amount of information quickly that we have been able to produce this report to allow the House to hold a debate within the CRaG scrutiny period. As we said at the working practices discussion, that is a short period. However, success that we were able to produce this report should not lead the House or the Government to think that this has been easy or will be easy in the future. We had notice and we planned accordingly, and because the deal is largely identical to an existing one, it does not raise some of the thornier issues, such as respect for human rights or food standards, that may well arise in other deals and agreements, and still it is very challenging to do CEPA justice.
We said in our working practices report that we reserve the right to recommend changes to CRaG if we conclude that, overall, the required pace is detrimental to the House’s scrutiny function. Nevertheless, I want to recognise that DIT has worked hard to make the process as it is work as well as it can in the circumstances, and the Minister and his staff should be commended for their efforts—I thank them, and particularly him. I look forward to hearing what noble Lords say in this debate. I beg to move.
In future deals, we will need to take a radically different approach, and we have an opportunity to do so in the New Zealand negotiations, given New Zealand’s credentials in this regard and its ground-breaking initiative to negotiate an agreement on climate change, trade and sustainability with Norway, Costa Rica, Iceland and Fiji. I hope we will take the opportunity this offers to create a forward-looking trade agreement with New Zealand which puts protection of the planet at its heart.
Next, I want to address the issue of public trust in our trade policy, which has not been well served by the way in which the Government have tried to oversell this agreement. Announcing the deal on 11 September in a press statement, the Secretary of State for Trade said:
“The agreement we have negotiated …. goes far beyond the existing EU deal”.
However, the impact assessment for this agreement suggests that it will increase UK GDP by £1.5 billion per annum in the long term, whereas the impact assessment for JEEPA, the Japanese-EU trade agreement, published in May 2018, estimated that it would increase UK GDP by £2.1 billion to £3 billion over the long term—a significantly larger figure. The Government will doubtless argue that the figures cannot be compared because they are modelled differently. However, if the Government will not provide us with comparative modelling, we can only go by their own previously published figures, and they do not in any way bear out the Government’s claims that this deal provides significant benefits over JEEPA—in fact, they show the contrary.
Overselling in this way undermines trust. That may be less important in respect of this deal, which has not given rise to significant public concern, but it will be a real problem when we come to more controversial deals, such as a potential agreement with the United States. I therefore urge the Minister to ensure that lessons are learned from this experience and, in future, that deals are communicated objectively on their merits rather than spun to be something other than they are. In this case, the Government should simply have stated the reality: that a rollover deal, with a few additions and a few subtractions, had been secured. That was the reality, full stop. That is what the Government should have said.
There are improvements on agricultural tariffs and things such as the administrative scheme enabling more geographic indications to be protected in the Japanese market—they are modest, but they can be developed, as the noble and learned Lord, Lord Goldsmith, said, in the CPTPP context, as long as we make progress there. I think we can and we will. It is not unimportant that Japan holds the chair of the CPTPP in 2021, and things such as digital trade developments and agricultural market access will be much improved if we are able to accede to the CPTPP. I hope that the Government will take that forward early in the new year.
The plus also includes areas where we want to go further—on financial services, on mutual recognition of qualifications, on the ability of people from this country to go to work in Japan, on the environment and sustainable development and for there to be an investment chapter, given the relative significance of Japanese investment in this country and that in the opposite direction, and in audio-visual and creative industries, where both we and Japan are world leaders and should be encouraging continuing trade. The noble Lord, Lord Foster, may want to say something about that.
Finally, using this agreement is really important, and I commend our colleagues in the embassy in Tokyo, because they recently appointed a digital trade and an agricultural trade attaché. If they, business, including SMEs, and the department use this agreement fully, we can make this a significant increment to our UK-Japan trade.
The Department for International Trade’s impact assessment on animal welfare is very limited, but it does state that
“imports will continue to meet the UK’s food safety standards”.
I do not doubt that food safety standards will be met—we have the FSA and the FSS to ensure that—but food safety is not the same as welfare standards. The former relates to the safety of the edible products from animals, the latter to how those animals were kept. These are different issues which require different expertise and processes to audit.
It is welcome that provisions in the UK-Japan trade agreement commit both parties to co-operation on matters of animal welfare. In addition, the DIT has committed to scrutiny of animal welfare standards in free trade agreements through a range of measures, including, where appropriate, assessments of animal welfare impacts. But the Regulatory Policy Committee report which assessed the DIT’s impact assessment stated that it should have given more detail on the impact on animal welfare and identified animal welfare as an area to be improved in future impact assessments. How will the DIT do that? Does it have the relevant expertise? Will the DIT fully utilise the Trade and Agriculture Commission? Particularly with regard to breadth and depth of expertise, will it co-operate fully with Defra on this?
I would welcome a response from the Minister to those questions which will provide further assurances that, in future trade agreements, the UK’s standards will not be compromised.
The trade observatory study also concluded that:
“In services and investment liberalisation, it is clear that Japan’s commitments to the EU and the UK are almost identical”.
Foreign direct investment is therefore one notably important area missing from the deal. The UK is Japan’s second-largest destination for FDI, totalling £131 billion in 2019. Japanese investment supports over 100,000 jobs in the UK in sectors such as manufacturing and scientific research. However, as Mr Motegi, the Japanese Foreign Minister said, at the signing of the deal:
“It is of paramount importance that the supply chain between the UK and the EU is maintained even after the UK’s withdrawal.”
He therefore had “high hopes” of a deal between London and Brussels—as I trust that we all do.
As the Financial Times pointed out on 13 September, the UK-Japan deal commits the UK to tougher restrictions on state aid than those that it has said it would accept in the context of a trade deal with the EU. Why, then, do the UK Government continue to regard state aid as a make or break issue for the crucial trade talks now taking place with Brussels?
The UK has said that this deal will be a stepping stone to the UK’s membership of the Trans-Pacific Partnership, but trade deals with countries on the other side of the world cannot replace those with the EU, the biggest and richest market on our doorstep, worth 47% of the UK’s trade in 2019.
The Government have sought to overplay the significance of the UK-Japan trade deal as cover for the chaos looming if the UK fails to secure an EU trade deal. As the Guardian business leader said on 13 September:
“A Japan trade deal is little consolation if Britain is locked out of the EU.”
“many of the additions focus on future discussions and awareness raising about existing enforcement procedures in both countries, rather than securing new … protections.”
To protect IP, the creative industries had sought much more. They wanted tougher measures to enable blocking of websites containing illegal content, along the lines that we already have in our own Digital Economy Act —but they did not get them. Can the Minister confirm that the UK will be reliant upon Japan’s existing IP enforcement procedures and that the deal does not commit Japan to any specific changes to those procedures?
The other two creative industry asks—public performance rights and artist resale rights—were not achieved either. Does the Minister acknowledge that stakeholders were given inaccurate expectations of what could be achieved in the deal?
The creative industries and other sectors may benefit from provisions on digital and data. But, as my noble friend Lord Oates pointed out, there are concerns about those provisions. One is that they could herald the lowering of our current GDPR-based data protection standards, perhaps to enable us to gain admission to the CPTPP given the lower standards of data protection in the Asia-Pacific region. In JEEPA, onward data flows are specifically excluded. Under CEPA, however, data which flows from the UK to Japan could be passed to other countries, through trade deals that Japan has with those countries, where lower data protection standards apply, thereby giving reduced protection to the personal data of UK citizens. I am not a believer in conspiracy theories, so will the Minister give an assurance that nothing in this agreement, or any future agreements, will reduce the standard of protection of the personal data of UK citizens from what is currently enjoyed?
This is a welcome deal because of the continuity that it provides. But it is little more than a rollover deal, one which has been oversold by the Government, appears to be far more beneficial to Japan than to the UK, and for which the Government have not even provided analysis to enable comparison of it with what we currently enjoy.
I am sceptical in the extreme about the figures shown in the impact assessment of this trade agreement with Japan, and even more so about attempts to break this speculative impact down by region. As someone said, such figures serve only to make astrology look respectable. Government statisticians would be better employed trying to calculate cost-benefit assessments of the effect of the Covid restrictions on lives and livelihoods than those of the CEPA.
On the CEPA itself, the most striking element is the agreement on digital trade and data, which, according to the brief, accounts for as much 30% of our trade with Japan—a figure I find it hard to get my head around. If it is correct, the positive measures in this agreement are likely to be important to trade with Japan, and even more valuable as a template for future trade agreements across the world.