Brexit: Least Developed Countries

Viscount Eccles Excerpts

Thursday 16th November 2017 Grand Committee

[Viscount Eccles (Con)]

My Lords, I should remind myself and the Committee that I was in development for a long time, working for the Commonwealth Development Corporation. I am historical because I became its chief executive about 30 years ago. Subsequently, of course, my noble friend Lady Chalker was my boss, so I had to pay very careful attention. If I may make a personal remark, I much preferred it then. It would be better today if DfID were part of the Foreign Office; making it a separate department was a mistake, and remains so.

I will duck Brexit because I do not have the slightest idea what will happen after it, and in the life of CDC, it will not make any significant difference, whatever the agreement or whichever way it goes. We are in long-term economic development. We will have investments at the time and will be making more, so I do not think it will make any difference. Co-operation with our European and United States partners, such as the IFC, DEG in Germany and FMO in Holland, goes on all the time and will undoubtedly continue. We will have joint investments and so we will have to talk to each other in a quiet and friendly way, otherwise things will not go well.

I say to the noble Lord, Lord Hughes, that for the 70 years of its history, CDC has been investing in power stations and electricity distribution, using hydroelectric as well as conventional electricity. It is still doing that; at the moment, it is working very hard in Sierra Leone on power generation and distribution. Of course that is tremendously important. You cannot have economic development and you cannot increase trade unless you have things to sell—and you do not have things to sell unless you create the companies to produce things that people want to buy. In the long term, it is economic development that tells the story.

I want to illustrate that point by talking about three countries. The Comoros have 800,000 people who are Sunni Muslim and $1,500 of income per capita. They were French—there are three islands and the French kept the fourth one, presumably because it was the best—and 300,000 Comorans live in France. How do you do long-term development for those islands? They export vanilla, which you can synthesise—but still, they export natural vanilla—and they have a tourist trade, with very good snorkelling. They also have political instability.

Then we go to the other end of the scale and the countries that are the least developed. Ethiopia has $1,900 dollars per capita and 105 million people. It has a difficult history, but it is the country from which coffee came. Coffee has not been mentioned specifically, but the way in which the European Union behaves about coffee is scandalous. It debars the least developed countries effectively from processing their own coffee; it tells them, “You can send us beans”. So there are things that might get better after Brexit. In Ethiopia, 45% of the population are Ethiopian orthodox Christians—rather different from 98% Sunni. In the middle, you have Tanzania with 50 million people. It was German but then it became British.

When you are thinking about aid, trade and economic development, it is incredibly important to understand the complexity of what you are engaged in and the amount of information that you have to collect. The banners that are put up to say that we are going to do the same thing everywhere just do not work.

It is incredibly important that we continue with a development finance institution such as the CDC, which puts people on the ground and has technology, electricity generation and distribution, and mobile telephones, for example. It used to have—and I hope it will have again—a lot of sophisticated agricultural technology, and will continue with the business of long-term economic development. Please may we cease to argue about the relative benefits of aid, trade and economic development? They all have their place but, if you want to solve the problems, it is economic development that will do it.