Blog

Commonwealth Trade Ministers Meeting – Interim Report on Private Sector Day

Commonwealth Trade Ministers Meeting
Interim Report on Private Sector Day, Thursday 9th March

The first day of the inaugural Commonwealth Trade Ministers Meeting took place at Lancaster House in London on Thursday 9th March with a day dedicated to dialogue with the private sector. Convened by the Commonwealth Enterprise and Investment Council (CWEIC) the day brought together 35 Ministers responsible for trade and investment, representatives from 45 Commonwealth countries and 100 international business leaders.

We look forward to developing a number of the excellent proposals that were made during the days discussions in the run up to the important Heads of Government Meeting in London next year. Our priorities will include:

  1. The appointment of a Commonwealth Trade Ambassador to gauge the trade and investment priorities of member countries and to scope the potential for the development of a “Commonwealth Trade and Investment Accord” which would underpin the development of trade and investment agreements between member countries.
  1. Identifying opportunities to improve the business environment in member countries and strengthening public-private dialogue. We will also champion the full implementation of the WTO Trade Facilitation Agreement by encouraging greater collaboration with the private sector and peer to peer learning at national, regional and international levels.
  1. Exploring the contribution the Commonwealth can make to the deployment of technologies for trade, including the development of paperless trade and collaboration on ecommerce. We will be looking at the possibility of developing an ecommerce legislative toolkit to encourage greater cooperation between Commonwealth countries.
  1. Strengthening connections between SMEs and entrepreneurs across the Commonwealth. This will include the expansion of our CommonwealthFirst SME Export programme across member countries, as well as continued support for the development of the Commonwealth Alliance of Young Entrepreneurs and initiatives to support female economic empowerment including the ITCs “SheTrades” programme.
  1. Financial services will continue to be important to our work. In particular we will focus on restoring correspondent banking links with the support of our strategic partners and opportunities in the insurance sector.
  1. Ensuring Commonwealth trade ministers meet on a regular basis. Initially we propose that trade ministers meet on a biennial basis in advance of the meeting of Heads of Government. This will ensure momentum is maintained.

Meeting Report

The objective of the day was to help define an ambitious “Agenda for Growth” to increase intra-Commonwealth trade to US$1 trillion by 2020 and to identify new opportunities to leverage the Commonwealth Factor; the shared values, language, legal framework and regulatory systems that makes trade costs 19 per cent lower between Commonwealth countries.

Opening Session

Speaking at the opening session Lord Marland said “Commonwealth trade ministers could not be meeting at a more auspicious time. A strong Commonwealth voice in support of free and fair trade is more important now than ever before. We need to be ambitious about what we can achieve together.” Lord Marland proposed the appointment of a Commonwealth Trade Ambassador to scope the possibility of developing a “Commonwealth Trade and Investment Accord” in the run up to the 2017 Commonwealth Heads of Government Meeting.

Rt Hon Liam Fox MP, UK Secretary of State for International Trade, said “This Commonwealth of Nations has the opportunity to lead the defence of free trade, working together to shape new policies and approaches, showing the world a route to prosperity that lies through partnership, not protectionism. Our trade ministers’ meeting is the first step in realising this vision. Our joint discussions and bilateral meetings will be a foundation upon which to build. Every agreement that we reach and every barrier that can subsequently be removed will materially improve the lives of our peoples across the globe.[1]

Nigerian Minister of Industry, Trade and Investment, Hon Dr.Okechukwu Enelamah noted that “Nigeria believes that a carefully defined trade-based Agenda for the Commonwealth is overdue. This is why this inaugural meeting of Trade Ministers is a sound idea. The Commonwealth has a role to play in a global economy in rapid and uncertain transformation. The effectiveness of this role will hinge on an agenda that is modern and, in tune with the technological and policy realities of the 21st Century.  Such an agenda would need to reflect objectivity and realism.”

The opening session was also addressed by Ms Arancha Gonzalez[2], Executive Director of the International Trade Centre who said “new bilateral, regional and plurilateral trade agreements could help Commonwealth members consolidate and deepen commercial ties.” She also highlighted the importance of the WTO Trade Facilitation Agreement; “The Commonwealth can work to ensure that the international community comes forward with the support needed to translate the promise of the new WTO agreement into real increases in trade. Not because it feels good to be charitable. But because reducing the costs of trade is what will help 90% of your businesses – SMEs – to trade across borders”.

Mr Shanker Singham, Director of Economic Policy and Prosperity Studies at the Legatum Institute, spoke about the future of UK trade policy and proposed the establishment of a “high standards plurilateral open accession” trade agreement to be led by Commonwealth countries[3].

Ministerial Roundtables

 The core of the day was built around six interactive Roundtables focusing on the six key pillars of the proposed “Agenda for Growth”:

  1. Financial Services
  2. Ease of Doing Business
  3. Technology and Innovation
  4. Business and Sustainability
  5. Creating an Export Economy
  6. Attracting Investment

The most promising recommendations from each of the Roundtables will be developed in advance of the Commonwealth Heads of Government Meeting, and associated Commonwealth Business Forum, to be hosted in the UK in April 2018.

Financial Services

The Financial Services Roundtable was led by the Hon Dr Christian Cardona MP, Maltese Minister for the Economy, Investment and Small Business, and facilitated by Sir Alan Yarrow, former Lord Mayor of London and member of the CWEIC Advisory Board. The Minister concluded:

“Financial and corporate services are a vital conduit for trade and investment across the Commonwealth, and in many Commonwealth countries they are the largest employer. As a significant component of all trade in services, greater liberalisation and improved regulation of the financial services industry will yield big results in terms of increased intra-Commonwealth trade and investment, and economic growth.

We focused on a number of key issues including improving financial regulation across the Commonwealth, the importance of the insurance industry, the challenges faced by small states with the loss of vital correspondent banking links, the opportunities presented by Fintech, and areas such as Islamic finance.

The key ideas which participants recommended exploring further were:

  1. Developing ongoing focus on strengthening the financial sector across the Commonwealth, including access to finance, better regulation and developing partnerships between Commonwealth financial centres.
  2. Identifying opportunities to enhance collaboration across the insurance industry in areas such as disaster risk, life insurance and export credit guarantees. The insurance industry has a key role to play in enabling good governance, strong institutions and creating capital for long term investment in areas such as infrastructure.
  3. The opportunity for the Commonwealth to help catalyse innovations in financial services, as with M-Pesa in Kenya, in areas such as mobile payments, crowd funding, blockchain and regulatory technologies.
  4. The need for wider education and knowledge transfer in the financial services sector across the Commonwealth that can help to empower member states and spread best practice.

We welcomed the support provided by Crown Agents Bank and Standard Chartered in helping countries restore correspondent banking links and encourage the international community to address this important issue.

We would like to thank all those who participated in this Roundtable and look forward to taking forward this agenda in the run up to the Commonwealth Heads of Government Meeting next year.”

Ease of Doing Business

The Hon Todd McClay, New Zealand’s Minister for Trade, who led the Ease of Doing Business Roundtable with the support of Professor Ngaire Woods, Dean of the Blavatnik School of Government at Oxford University, said:

“On behalf of all my Ministerial colleagues we would like to thank everyone who participated in the Ease of Doing Business Roundtable. We were encouraged by the strong contributions from the private sector and international organisations. We covered a wide range of subjects including trade agreements, the importance of the World Bank Ease of Doing Business Index, the WTO Trade Facilitation Agreement, standards and corporate governance and the opportunity to better leverage the Commonwealth Factor in each of these areas. We recognised the importance of robust public private dialogue at all levels.

New Zealand is proud to top the World Bank’s Ease of Doing Business Rankings which is recognition of the robust open economy that has underpinned New Zealand’s strong economic performance. In New Zealand we have made a commitment to ensuring that policy changes have no more of an increased cost to businesses than to Government. Our Ministers are committed to creating a climate that is business friendly. For improvements to be seen across the Commonwealth, leadership and policy makers in all member states should look to make the same commitment.

Participants agreed that there is a strong potential to do more to share best practice across our countries and to work together to help facilitate trade and investment.

The areas we would like to see explored further include:

  • Develop a mechanism which supports and enhances public/private sector dialogue so businesses can tell Government what is working and what is not, and vice versa.
  • The Commonwealth Enterprise and Investment Council should support its members, both Governments and private sector, to review their decision making structure and ensure any new legislation is not detrimental to the ease of doing business.
  • Establish and develop a robust mechanism for collecting and indexing meaningful data which will support Governments in their drive for competitiveness and have a formal structure for assessing the results at a Commonwealth level, particularly in relation to the WTO Trade Facilitation Agreement. It was noted that in some states you would need to do this at a regional level.
  • Recgonising the opportunity to increase intra-Commonwealth trade by 10% through greater standards harmonisation, we welcome the offer from BSI, the UK National Standards Body, to establish a Commonwealth Standards Network to launch at CHOGM 2018, to agree priority standards that will support Commonwealth trade.
  • The opoprtunity for the Commonwealth to do more to faciilitate bilateral and plurilateral trade agreements between member countries to improve the ease of doing business.”

Technology and Innovation

The Hon François-Philippe Champagne, Canadian Minister for International Trade, and Gerard Grech, CEO of Tech City UK, led the Technology and Innovation Roundtable.

They welcomed the focus on technology and recognise its importance for future growth in trade and investment, and the enormous potential for improving connectivity and commerce across our countries. Commonwealth countries, regardless of their level of development, must fully embrace the digital economy or risk falling behind. There is a strong opportunity for greater collaboration in this area, and initiatives such as the Vancouver based Commonwealth of Learning demonstrate the importance of strong partnerships in these areas.

The session focused on a variety of issues including the digital economy and e-commerce, supporting tech entrepreneurs, investment in science and innovation and open data.

In particular we were encouraged by participants’ enthusiasm for helping Commonwealth countries to better engage in e-commerce as a way of boosting participation in the domestic and global economy. We would like to see more technical assistance and capacity building in this area. The possibility of establishing an e-commerce legislative toolkit was discussed.

It was noted that a number of Commonwealth cities had well developed technology hubs, including Nairobi, London, Bangalore, Kingston and Vancouver, and we would like to see greater collaboration to help technology entrepreneurs expand their businesses into new Commonwealth markets. We would also be keen to ensure Commonwealth countries are developing the computing and coding talent required for the modern economy.

We congratulate the Royal Society on reinvigorating the Commonwealth Science Conference, which will be held in Singapore in June this year. This will be an opportunity to celebrate excellence in science and encourage more collaboration across Commonwealth research institutions.

The opportunities provided by open data were also discussed. Canada is proud to have provided global leadership in this area and we encourage all Commonwealth countries to adopt the Open Data Charter, as well as exploring opportunities for the Commonwealth countries to share best practice and take full advantage of our similar legal and regulatory systems. The Open Data Institute is ideally placed to help take this work forward.

We would like to thank all Ministers and private sector representatives for contributing to this rich discussion and we look forward to seeing progress on these issues in the run up to the Commonwealth Heads of Government Meeting next year.[4]

Business and Sustainability

The Hon Malik Samarawickrama, Minister of Development Strategies and International Trade in Sri Lanka, who led the Business and Sustainability Roundtable, supported by Mr Mohamed Amersi, Founder of the Inclusive Ventures Group, concluded:

“It was an honour to Chair this important session at the Commonwealth Trade Ministers Meeting. The Sustainable Development Goals provide an important framework to encourage business and Governments to work together to promote sustainable trade and investment.

The main issues discussed were financing the UN Sustainable Development Goals, growing the green economy, impact investment, and encouraging diversity and economic empowerment. Ministers recognised that without private sector engagement the SDG’s would not be met by 2030 and that this also presented a big opportunity for business as identified by the Business and Sustainable Development Commission.

The Roundtable proposed the following areas to take forward:

  1. Encouraging strong partnerships in the environmental sector in regards to technology and climate change mitigation.
  2. Raising awareness of the Sustainable Development Goals and encouraging greater public-private collaboration in ensuring delivery by 2030.
  3. Exploring new models for green financing in Commonwealth countries including the development of the Commonwealth Green Finance Facility.
  4. The possibility of establishing a Commonwealth Impact Investment Fund to catalyse social investment in smaller Commonwealth countries.
  5. An analysis of the impact of India’s mandatory requirement for larger companies to spend 2% of profits on CSR.
  6. Explore ways to encourage greater female economic empowerment in Commonwealth countries, including a possible collaboration with the ITC “SheTrades” programme, as well supporting youth entrepreneurship and other minority groups to participate fully in the global economy.

I am grateful to my Ministerial colleagues and leading private sector representatives for their contribution to this discussion.”

Creating an Export Economy

The Hon Adan Mohamed, Kenyan Cabinet Secretary for the Ministry of Industry, Trade and Cooperatives, who led the Creating an Export Economy Roundtable, supported by Mr Kirk Hope, Chief Executive of Business NZ, said:

“I would like to thank my fellow Commonwealth Trade Ministers and private sector representatives who have participated in the Creating an Export Economy Roundtable. Increasing exports to drive growth is integral if Commonwealth economies are to be successful and it is important to create both an entrepreneurial and export-orientated mind-set in this regard.

Both Mr Hope and I welcomed the various contributions made by decision makers and private sector leaders. The dialogue followed a number of themes including access to markets, export diversification, SMEs and enterprise development, and trade finance and export credit guarantees.

Kenya has worked hard in the past decade to support our exporters, which has helped us climb 44 places over 2 years in the World Bank’s Ease of Doing Business Rankings, making Kenya the 3rd most improved country globally. It is clear that SME’s can be the drivers of developing industries if entrepreneurship and innovation is supported and businesses have access to appropriate advice. Much more can be done to help exporters access other Commonwealth markets.

The key outcomes of the Roundtable were:

  1. Recognition of the importance of exports as an economic driver and the need to help businesses, both large and small, to look beyond their domestic markets.
  2. Recognition of the importance of helping SMEs to export, and providing them with access to finance and relevant information about the requirements of target export markets. We welcomed the establishment of India’s Commonwealth SME Association with the support of the Commonwealth Secretariat and plans to hold an SME Summit in May 2016 and encouraged countries to support the Commonwealth Trade Finance Facility.
  3. We commended the Commonwealth Enterprise and Investment Council for their CommonwealthFirst SME Export initiative, launched with the support of Royal Mail, and would like to see this replicated across the Commonwealth to help increase knowledge of Commonwealth markets amongst SMEs.
  4. Recognition of the need to better utilise technology to improve the efficiency of trade between Commonwealth countries.

Attracting Investment

The Hon Steven Ciobo MP, Australia’s Minister for Trade, Tourism and Investment  led the Attracting Investment roundtable with the support of Sir Lynton Crosby, founder of the Crosby Textor Group. We would like to thank all participating Ministers and private sector leaders for their excellent contributions.

The Roundtable covered a variety of themes including trends in foreign direct investment, promoting investment, infrastructure investment and investment agreements and guarantees. Specifically, participants focused on how the Commonwealth Factor can be beneficial to these areas and can be used to support growth and investment.

Participants, both from Government and private sector, recognised the key role that critical infrastructure has to play both in terms of attracting investment and managing impact on domestic populations. Currently only 0.8% of global investment funds are allocated to infrastructure.

The key recommendations from the Roundtable were:

  1. The Commonwealth should work to support states to develop investment promotion strategies that are suited to the digital age.
  2. The Commonwealth should develop a mechanism which supports more integrated supply chains across member states.
  3. The Commonwealth Enterprise and Investment Council should organise a series of regional forums which showcase investment opportunities to investors specifically interested in that region.
  4. The rule of law should be enhanced through sharing of best practice and knowledge and capacity building, and Government’s should be supported in building up a ‘standard response’ to concerns about investing in their region.
  5. Skills and education policies should be aligned with economic ambitions to ensure that communities across the Commonwealth are able to benefit from investment in their areas through employment opportunities.

Concluding Session

The concluding session was addressed by Hon Dr Christian Cardona MP, Minister for the Economy, Investment and Small Business, Malta (currently Commonwealth Chair-in-Office and President of the Council of the European Union) who said “we cannot be globally competitive if we are isolated. We need to ensure an open trade system, whereby countries can enjoy the benefits of international trade. This is of particular importance for small economies that are dependent on international markets for economic growth. Together, we can do useful work to assist developing countries access international markets.”

The leaders of each of the Roundtables presented their conclusions from the sessions.

Mr Nirj Deva MEP outlined his proposals for European Development Funding to be more focused on private sector development in future. He argued for EU development funds to be leveraged by blending the EU’s public funds with private investment guaranteed by the European Fund for Sustainable Development (EFSD).

Mr Ken Smith, Agent-General for Queensland, highlighted the strong trade and investment agenda that would be part of the Gold Coast Commonwealth Games in Australia in April 2018. He encouraged all Commonwealth countries to get involved in the business programme, which will be hosted at a purpose built “Commonwealth House”. CWEIC will be working closely with the Gold Coast and Government of Queensland to deliver this.

The day concluded with a Reception hosted at Lancaster House with the support of the Maltese Government and was attended by CWEIC’s CommonwealthFirst Export Champions and UK Parliamentarians. We also thank the UK Government for their financial support and the use of Lancaster House.

A dinner was hosted at Mansion Housed by The Rt Hon Lord Mayor of London with the support of De La Rue. Speaking at the dinner Rt Hon Priti Patel MP said: “we must entrench the Commonwealth’s position as a beacon of co-operation, trade and partnership. And through the crucial institution of the Commonwealth, we can and must work together to build a better, more prosperous, and more stable world for us all”.[5]

Commonwealth Trade Ministers Roundtable

The second day of the event was a closed door meeting of Ministers convened by the Secretary-General, the Commonwealth Secretariat and the CWEIC at Marlborough House.

A concluding statement from the Chair of the Meeting, HonMalik Samarawickrema, Minister of Development Strategies and International Trade, Sri Lanka is available at http://thecommonwealth.org/media/press-release/trade-ministers-pledge-harness-commonwealth-advantage-historic-meeting. All supporting documents are available at http://thecommonwealth.org/media/event/commonwealth-trade-ministers-roundtable.

Wilton Park

Following on from the Trade Ministers Meeting, a conference was held on 10-12 March at Wilton Park, an executive agency of the UK Foreign and Commonwealth Office, on “A consensus-based Commonwealth vision for trade negotiation, facilitation and finance” to look at how the Commonwealth could do more to advance members objectives within the WTO. A report on this event, which included senior officials from the WTO, will be available at www.wiltonpark.org.uk.

Overseas Development Institute/ All Party Parliamentary Group on Trade Out of Poverty

Ahead of the Ministers Meeting, the Overseas Development Institute and the All-Party Parliamentary Group on Trade Out of Poverty put forward 10 policy priorities for trade ministers to consider. This was launched at a Reception in Parliament on 8th March attended by many trade ministers. CWEIC would like to commend both organisations for this initiative. Further information is available at https://www.odi.org/publications/10735-10-commonwealth-policy-priorities-trade-and-development.

Towards CHOGM 2018

CWEIC will be actively working with the Commonwealth Secretariat, member Governments and the private sector to take forward our priorities from the Trade Ministers Meeting in the run up to next year’s Commonwealth Heads of Government Meeting (CHOGM) in London in April 2018. We welcome additional feedback and input as we develop the “Agenda for Growth.”

We hope that Commonwealth trade ministers will agree to meet on a regular basis, and we initially propose that ministers meet on a biennial basis in the run up to each CHOGM.

Finally we would like to thank all ministers and participants for contributing to the success of the inaugural Commonwealth Trade Ministers Meeting – a truly historic occasion. In particular we would like to thank the UK and Maltese Governments for their financial contribution for the event, the Commonwealth Secretariat for hosting the second day and the City of London and De La Rue for their support for the dinner.

We also thank all our members, including our Country Strategic Partners, for their ongoing support of our institution without whom are work would not be possible.

 

Contact

For further information please contact:

John Pemberton-Pigott
Director of Programmes
Commonwealth Enterprise and Investment Council
john@cweic.org
+44 (0) 2071046336

 

Commonwealth Enterprise and Investment Council
March 2017

 

 

 

[1] Full speech by Rt Hon. Dr Liam Fox MP available at https://www.gov.uk/government/speeches/commonwealth-trade-ministers-meeting-towards-a-free-trading-future

[2] Full speech by Arancha Gonzalez available at http://www.intracen.org/news/Address-to-Commonwealth-Trade-Ministers-Meeting/

[3] Full speech by Shanker Singham available at  http://www.li.com/media/commentary/shanker-singham-delivers-speech-to-commonwealth-trade-ministers

[4] Opening remarks by Hon. François-Philippe Champagne available at https://www.canada.ca/en/global-affairs/news/2017/03/address_by_ministerchampagneattheinauguralcommonwealthtrademinis.html

[5] Full speech by  Rt Hon Priti Patel MP available at https://www.gov.uk/government/speeches/priti-patel-commonwealth-trade-speech