Opening ceremony, Commonwealth Business Forum

Mr President, Honourable Ministers, Mr Director-General, Distinguished guests, Ladies and Gentlemen … you lay down a serious challenge for us, when you give this Business Forum the theme of ‘The Untapped Potential’ of the Commonwealth.

Your counterparts in civil society did something similar when on Sunday they launched the People’s Forum which is running alongside yours. Their theme is ‘Realising People’s Potential’.

And President Museveni of Uganda - with whom I am delighted to share a platform today - was thinking along similar lines when he asked his fellow Heads of Government to address one, huge, question in their Meeting which begins on Friday. Just how, he asks, are we are to, quote, ‘transform societies to achieve political, economic and human development’?

The message for the Commonwealth business community, for its civil society community and for its Heads of Government seems to be the same. It is, simply, that whatever progress the Commonwealth is making, it still has a long way to go. I suggest we keep just one figure in our mind, that three-quarters of a billion Commonwealth citizens live in dollar-a-day poverty.

Your focus in this Forum is of course the private sector. It is trade, business, investment and economic development. Yours is the big view, and often the macro-economic one. The quality of private sector representation in this room, with over 300 leading companies from Africa and around the Commonwealth here today, ensures that that is the case. I shall come back to that.

But first I must state an obvious point which may be so obvious that no one quite remembers to say it. If business, civil society and heads of government are all asking the same question, then it follows that all are part of the answer, and that all have a stake in achieving the answers.

That is because the essence of ‘transformation’, or of ‘tapping potential’ and ‘realizing potential’ far, far outweighs mere economic development.

It’s our Commonwealth view that economic theories and practices alone will bring about neither full transformation nor full development. If transformation really is something that must be embraced by all and be for all, then it must be more than economics. Transformed societies are societies in which all people understand and support what is happening and why; and in which everyone plays a part and everyone benefits – individually, and collectively. In short, transformation must be democratic. That is my vision and I believe it is the vision of our modern Commonwealth.

On other platforms, I have talked about what I see as the real ingredients of transformation. I have spoken about the primacy of elections and democratic institutions; about democracy as a deep-rooted culture, which brings with it a free yet responsible media; a lively civil society; and a society that values and includes its women and girls as much as its men and boys, its children and youth as much as its adults; its human rights, and its different religious, linguistic or ethnic communities.

What’s more, the ingredients of economic development and broader transformation only take on real shape when they are democratic. Hence the need to promote all business activity – as much for small businesses and women and youth entrepreneurs, as for big business. Hence, too, the need for responsible business – which is accountable socially and environmentally as well as financially. Similarly, democracy is at play in the rules that govern and protect business conduct – in legislation and ways of enforcing it. The Commonwealth Business Council said as much in an important series of 16 principles of proper investment, which were endorsed by Heads of Government at the CHOGM in Coolum, Australia, in 2003. The clearest indication of a society’s commitment to itself is that its citizens invest their hard-earned cash in the country itself, and don’t take their money beyond its borders to keep it ‘safe’. They should be able to establish themselves in business in days, not months. They should have the confidence to live, work, save and invest in their own countries.

These are the ingredients of the ‘transformation’ and the ‘potential’ which are your Forum themes. And it’s the great advantage of the Commonwealth’s networks – with so many formal and informal channels and so many crossovers – that we can all share these challenges and discuss them: the public sector, the private sector and civil society.

Both the Business Forum and the People’s Forum will feed into CHOGM itself. But will they feed into each other? Will business people attend civil society events here, and vice-versa?

Government needs to work in tandem with business and civil society. Three animals which have sometimes been found pacing around each other in their cages, suspiciously and even aggressively – are increasingly working together. I have seen these public-private or even three-way partnerships myself, especially in water and road projects in South Africa and India.

So I have begun this morning by challenging you to see the process of ‘tapping potential’ as at heart a political and social process as much as an economic one, and to see it as a task which business must share with government and with civil society.

Let me challenge you further today, with what may be more unexpected arguments, about economic development in the Commonwealth.

Here, I recall the two requests that came from the Commonwealth Business Forum in Malta two years ago. You wanted us to stimulate economic growth in the Commonwealth, first by lobbying hard for the conclusion of a deal in the Doha Round, and second by maximizing the benefits of trade amongst ourselves in the Commonwealth.

First, trade. We have pushed tirelessly for a rules-based multilateral system under the WTO, and we continue to do so. The Valletta Statement on Multilateral Trade was a brave and outspoken demand from a quarter of the world’s nations (and a fifth of its trade), calling on rich countries to give more than they receive in the Doha Round. The Commonwealth has backed it up, with advisers in 20 countries and 6 regional trade bodies like CARICOM and the Pacific Islands Forum, advising on WTO negotiations.

But at present – let’s face it – the Doha Round is stuck in the slow lane. Too many vested interests are at play in developed and developing country members alike, and those in between. Too many are thinking globally at the WTO but acting nationally at home and in their delegations in Geneva. There are also the closing stages of the new Economic Partnership Agreements between the EU and the Africa-Caribbean-Pacific countries, which have to replace the Cotonou Agreements by the end of this year. And which, by the way, the Commonwealth continues to support by helping to coordinate and offer options on ACP negotiating stances.

I’ll return to this logjam, by way of the second request you made of us, that we need to promote intra-Commonwealth trade.

We have researched this thoroughly, and a fortnight ago we published what I believe is an excellent paper on the subject. It has some surprising findings.

Like the fact that we in the Commonwealth may export $170 billion worth of goods to each other each year, but we export another $970 billion worth to non-Commonwealth countries. Just 15% of our trade is amongst ourselves. Now admittedly these figures are for goods and not for services, but they dispel the myth that we are – or that we can necessarily be – a closely-knit trading club. We have outgrown the old, colonial arrangements, largely centred around the United Kingdom, where Zambian copper or New Zealand lamb or Barbadian sugar supported a whole empire. We all know that we cannot return to the preferential trading area which ended over 30 years ago, in essence when the United Kingdom joined the-then European Economic Community.

Look closer at those $170 billion, and you see that our smaller Commonwealth countries do, in fact, still trade predominantly with each other. You will also see that it’s the biggest players – like the UK and India – which are trading outside the Commonwealth. The UK largely with the EU, and India with China.

Does that mean that we abandon the idea of intra-Commonwealth trade, and sacrifice it on the altar of the global trade which we prize so highly? Of course not!

It means that we should continue to promote trade between ourselves, within the context of trade beyond our borders. Indeed, by promoting it between ourselves, we will be in better shape to promote it beyond.

So how can the Commonwealth bring this about? The answer lies in trade facilitation. In other words, making trade between us an easier, simpler, smoother thing. Improving customs facilities, for instance, or quarantine systems, or banking or transport links, or even the legal frameworks for business in areas like tax, and commercial grievance, and the setting up and the winding down of businesses.

Much of this work in developing countries can and should be funded by what is known as ‘Aid for Trade’. Bigger donors than the Commonwealth, coupled with investors and business people like yourselves, can meet the most expensive needs, especially in infrastructure. The Commonwealth’s real expertise will come in what may seem like the lesser things, the more painstaking things.

I visited a Commonwealth project in Kenya recently which has cut a third off the time goods spent in port customs at Mombassa, and the same at Jomo Kenyatta Airport in Nairobi. This is where the benefits of the Commonwealth network – shared language, shared institutions, shared traditions – comes into play. A quarantine system in Papua New Guinea is probably similar to a quarantine system in Guyana, and one in Australia and one in Ghana. It’s the quickest, easiest thing in the world for us to send experts between these countries to advise each other and improve them all.

So your two Malta requests in fact come together. While at the policy level we will continue to lobby for a global trading system in which our poorer countries can play their full part …. in the meantime, we’ll bring support to those poorer countries to allow them to trade their way to prosperity – first with each other, and second with the world beyond.

Ladies and gentlemen, there is so much more. I’d like to talk about aid and debt, about investment, about the environment, about the dynamos that are small businesses, about our Commonwealth work analysing the perils and the potential of our Commonwealth small state economies – well over half of us. I’d like to pose questions – like why the countries, especially in Africa, which have done the hard work of macro-economic stabilisation are not yet getting the credit in the form of more investment? And why the increasing economic integration in the regions of the Commonwealth – especially the Caribbean and the Pacific – is slow to yield more growth? But time precludes.

So as I thank Mohan Kaul and the Commonwealth Business Council for a decade of exceptional work – not just in convening Forums like these, but in first-class work that has spurred growth and livelihoods – I leave you with these two thoughts.

First, that ‘tapping potential’ is as much a result of democratic culture as of economic empowerment. And second, that even though we have a unique capacity to help each other to trade among ourselves, in the final analysis we must trade with the whole world.

Thank you.