3. What contact has the Welsh Government made with non-EU countries in the run up to leaving the EU? OAQ53525

Well, since devolution, we've worked hard to develop relationships with countries around the world. Last year, as a part of the Brexit preparedness work, we opened two new offices—one in Qatar and another in Canada. We undertook 10 trade missions to non-EU countries and, of course, we maintain strong diplomatic links with non-EU consuls and embassies.  

Thank you for that answer, Minister. A recent media report shows that the UK public finances are on the mend, recording a healthy surplus in January on booming tax receipts. Employment—[Interruption.] Read the papers. Employment is at record levels with real-wage growth at a two-year high. Despite a global slowdown, Britain expanded 1.4 per cent last year, recording just 4 per cent unemployment. Yet Germany and France are on the brink of recession, the Italian economy is contracting, and eurozone joblessness is twice as high. It's clear that Labour's wish to stay in the EU against the wishes of a majority of Welsh voters is economically flawed. Although we can't enter into trade deals separately to the rest of the UK, we can forge lasting and productive relationships that result in inward investment from countries that are on the up, including those in the Commonwealth. So, what is your assessment of the scope for trade and investment between Wales and key economies in the Commonwealth? 

Well, I think this is one of those old chestnuts that's been pushed by members of UKIP and other Brexiteers over the years. They want to hark back to this ideal of when Britain was great and we ruled the world and we had empires, and, actually, the world has moved on since then. What we have now is a globally interconnected world where we are totally dependent on each other. And you can see that what's happened in recent weeks is that companies like Honda have recognised that, because of the links and the supply chain that can't be cut off, actually, that interconnectedness and the fact that we don't have an interconnectedness if we leave the European Union will cause problems and will cause unemployment. And you're absolutely right: I think we should be proud of the record levels of employment that we have in Wales at the moment, but we do still have issues with low pay, and that's why what we're doing now is we're trying to focus attention on trying to create new jobs that are high-skill, highly paid jobs, and I think that, actually, I've got to tell you that in my recent dealings with trying to speak to inward investors, the real issue is how we keep people who've invested here already here when they know that, actually, there could be barriers to trade in future. It's a very, very difficult message for us to sell at the moment. I'm confident that, actually, we have the skills, the ability and the talent in Wales that people will continue to invest in our country, but I've got to tell you that Brexit doesn't make it any easier.

Minister, I know that, in the international strategy you're developing, you will have regard to 'Selling Wales to the World', the report of the Economy, Infrastructure and Skills Committee, and I think it's really important in developing these export strategies that we realise that, as well as the big companies—they're very, very important—SMEs in higher level high-value manufacture and in digital industries are key, really, to our future growth. And I do hope when you're choosing trade missions that you will give full recognition to the needs and desires and the recommendations that SMEs are making for markets that could be more open to Welsh trade.

I think that's absolutely right, and I think, if we are going to make an impact globally now, we're going to have to learn to really specialise. That's the way that we're going to really make an impact globally, and I think your emphasis on digital is crucial. I think we probably need to go even more detailed—. I would like to see us specialising absolutely in cyber security, for example—really digging in on an area like that, making sure we have the skills available amongst colleges and universities here so that we can really attract companies. It's not just about attracting companies here that are high-skill, high-tech that can be nimble and quick—those SME companies—but actually what we want is for our SME companies to be selling their skills across the globe. And I think you're right: I think what we're going to need to do in future is to perhaps focus not just on randomly going round the world on trade missions, but to really focus on where do we want to make an impact, going to trade fairs where you can meet a whole load of different companies at the same time, but take then specialised companies in those areas. So, that's certainly something I'm exploring in the context of the new international strategy.

Minister, I think it's important that we do look beyond the EU as to where our next markets are, and your strategy will hopefully prioritise those countries very much so. Last night, at the meeting of the cross-party group on STEM, we had Newport Wafer, who were in talking about their expertise, their skills and how many overseas countries and staff wanted to work with them here in the UK and in Wales. Now, it's that type of approach that we need to take. Are you therefore meeting with our businesses here in Wales to see the countries that they are talking to, the countries that they are working with, so we can ensure that we do target the right areas for employment and high-skilled jobs here in Wales?

In relation to the Commonwealth, we met with the New Zealand ambassador when we were in Brussels a couple of weeks ago, and it was quite clear that they have different agendas as well because they recognise the distance between us and New Zealand, and they have an agenda focusing more on the Pacific. So, it's clear that we need to focus upon the businesses that want to come here, the businesses that are working with Welsh businesses, but also markets that are close at hand so that, when we do want to sell, particularly agricultural goods, we have the businesses to sell them to.

So, I think these are slightly different markets. So, there are areas where, clearly, what we need to do is not lose the market share that we have in Europe at the moment. We have 60 per cent of our trade with the European Union, and we don't want to lose that. So, part of what we need to be doing over the next few weeks and months is to lock down that relationship, irrespective of what happens in relation to Brexit. That's got to be one of the priorities. But it's back to this: what are those companies where we have real expertise, real specialism—like you've mentioned, the semiconductor operations we have here—that are world-leading? It's not necessarily about going to a particular country. It's perhaps about linking up with relevant companies, universities, researchers in those areas. And I do think that that we probably have to change our mind frame slightly, because I'm not sure if it's always going to be about choosing a country that we think might grow in future. I think we have to understand that the world is becoming a lot more specialised and, if we want to make an impact, we have to specialise also. Semiconductors is, apart from cyber security—those are two of the absolute key top priorities that I would see that we need to really focus on.

Question 4 [OAQ53512] has been withdrawn. Question 5, Rhianon Passmore.