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Foreign and Commonwealth Office

My Lords, the noble Lord, Lord Wallace, has done a great job in bringing this matter to our attention, and he should be pleased that he has received such unanimity of support for what he said. The fact is that the constant erosion of the Foreign Office budget is nothing short of a national catastrophe, and I hope that the Minister is not only listening, but able to do something about it. I am going to move the debate towards Latin America, mainly because it is the area in which I spent most of my working life. While I am in complete agreement that China and India are vitally important and fast-growing economies, that does not mean that Latin America, with its considerable economic potential, should be neglected or excluded. When the noble and learned Lord, Lord Howe of Aberavon, was Foreign Secretary—I am sorry he is not in his place—he made a famous speech about Latin America in which he said: "““The age of neglect is over””." Unfortunately it has returned with a vengeance and has even been extended. An examination of recent GDP figures shows that total Latin American GDP is slightly larger than China with less than half the population. However, Brazil, which is the lead country in Latin America, and Mexico, which is the second, are only a few GDP points behind India with much smaller populations. This shows that Latin American purchasing power is valuable and we should be doing something about it. Of course, Latin America is a very diverse region, but the potential is there. In spite of that potential, we have chosen to cut four posts, downgrade others, cut staff and give the impression of a lack of interest in commercial relationships. Doing business in Latin America, like elsewhere, requires good contacts. During the 1960s, 1970s and 1980s, I was responsible for building local Latin American subsidiaries of British companies. Embassy staff on the ground provided both political and economic advice, but above all vital personal contacts. In those days, embassies had both UK and locally engaged commercial officers, but these have now gone. They should be reinstated instead of relying on UKTI information from London. EU embassies have been mentioned, and indeed they exist in all Latin American countries, but they are concerned with trade and can do nothing in response to British business interests. Moreover, British companies are often in direct competition with our major European partners—Spain, France, Germany and Italy—so despite the fact that they may be useful in other ways, EU embassies are no help to us in that respect. I have made the case before that we should reinstate UKTI inside the Foreign Office, and indeed on the last occasion I said this, I received considerable support from the noble Baroness, Lady Symons of Vernham Dean, who is to follow me. I hope that she is still of a like mind. There is another organisation outside which used to be called the Committee of Invisible Exports and now has a new name. It is about to be headed up by a recently retired British ambassador, and I believe that it is of a like mind on this issue as well. The fact is that the Foreign and Commonwealth Office is the smallest and was always by far the most efficient department in Whitehall. It should be re-empowered to do the job for which it was originally conceived and which it did so brilliantly. I like to think that this will happen, but I am not very optimistic about what is happening at the moment in budgetary terms. I hope that the Minister will have something useful to say on this matter.