With permission, Mr. Speaker, I should like to make a statement about the European Council held in Brussels that I attended with the Foreign Secretary on 19 and 20 June. The main business of the Council on Thursday and Friday evening was to focus on the economic challenges ahead-the triple challenge of rising oil prices, rising food prices and, because of the credit crunch, the rising cost of money-and, in the wake of the US downturn, on measures to keep the European economy moving forward.

Important conclusions were also reached on the Irish referendum, on climate change, on the millennium development goals and on the European response to the deteriorating situation in Zimbabwe. On Thursday evening, in the discussion on the Irish referendum vote, the Irish Taoiseach, Brian Cowen, offered to the Council meeting in October a report on the next stage for Ireland. The Council held that other member states will continue with their ratification processes and I was able to report for the UK that-like in 18 other countries-the Lisbon treaty had completed its parliamentary process and that the Bill received Royal Assent on Thursday. Once we have received the judgment in the ongoing legal case, we will move to ratification.

This time last year the price of oil was about $65 a barrel. At the last European Council in March it stood at $107. At the June Council, the oil price had risen further still to more than $135 a barrel. The global challenge that we face is a rising demand for oil-particularly from China and the other emerging economies now and in the future-that has so far been only partly met by an increase in supply, driving up fuel bills for families across the whole of Europe. Governments are taking action domestically to help-including our winter allowance and the new agreement that we have signed with utility companies for low-income households-but we know that those are ultimately global problems that require global solutions. The shared European view is that we must take action to reduce our dependence on oil and to improve our energy efficiency.

The new technology of carbon capture and storage will help us continue to use coal, oil and gas in a way that avoids harmful emissions, so earlier this year we reiterated our commitment to move forward with up to 12 commercial scale carbon capture and storage plants by 2015. Last week, accepting UK arguments about the importance and urgency of the matter, the Council called on the Commission to bring forward an incentive mechanism to achieve that goal. Britain is ready to have the first such plant in Europe.

Transport will account for two thirds of future increases in oil demand so improving fuel efficiency and exploring alternatives to petrol and diesel is essential to incentivise innovation among car manufacturers. The UK will continue to push for a commitment to an EU-wide car emissions target of 100 g per kilometre by 2020-down from 160 g, and a 40 per cent. reduction-saving the British family about £500 a year in fuel costs. At Britain's urging, the Council also agreed to explore the scope to accelerate the introduction of commercially viable electric vehicles and the infrastructure that their widespread use would require across the EU. Generating electricity is significantly less carbon intensive than using oil, and with all major car manufacturers-including all UK-based ones-now close to developing commercially viable hybrid and electric vehicles, they have the potential to reduce our dependency on oil and our carbon emissions as well as to create thousands of jobs in the British automotive industry.

All those measures will help to meet our overall target of reducing carbon emissions by 20 per cent. by 2020-or by 30 per cent. as part of a wider international agreement-but these decisions are made in the context of a dialogue between oil producers and consumers, where both should commit to greater transparency and a better balance between supply and demand. The Council therefore welcomed Saudi Arabia's high-level meeting between oil producers and consumers, which I attended, in Jeddah this weekend. I am today writing to all European leaders to inform them of the results of the Jeddah process, which will lead to a follow-up summit in London later this year. I can tell the House that the summit discussed measures to deliver a more sustainable global oil price, to reduce the risks and uncertainty that can increase prices and to ensure greater investment in oil production as well as energy efficiency and alternatives to oil.

I proposed that Britain and other oil consumers should open up our markets to new investment from oil producers in all forms of energy, including renewables and nuclear, providing all producers with a long-term future in non-oil energy. In return, oil producers should be open to increased funding and expertise in oil exploration and development through co-operation with external investors, providing increased oil supply in the medium term while growing economies adjust to a less oil-intense long-term future. The House will know that Saudi Arabia announced at the summit its increases in oil production.

The prices of rice and wheat are now double what they were only a year ago. Higher food prices cause concern to many of us here at home, but in poor countries, where food often accounts for more than half a family's spending, they can be even more devastating. To tackle rising prices both here and overseas and to help boost agricultural production, the Council agreed to implement the conclusions of the Rome food summit. It also agreed to assess the evidence of the indirect impact of biofuel, and the UK's Gallagher review on the indirect impact, due to report shortly, will be part of that process.

We also committed to work towards a successful outcome to the Doha trade round, where eliminating trade-distorting subsidies and import restrictions could increase global gross domestic product by as much as $300 billion a year by 2015. That is something that I have discussed with President Bush, President Lula, Chancellor Merkel and President Barroso as well as with the European Trade Commissioner, Peter Mandelson, in recent days. I believe that while we are at the eleventh hour in getting a trade deal, a trade deal is definitively within our grasp.

The European Union must take action on the elements of the common agricultural policy that raise the cost of food for consumers across Europe. Removing incentives for taking arable land out of production, for example, could reduce cereal prices by up to 5 per cent. The Council agreed to re-examine the issues of fair competition and sustainable agriculture.

As part of the year of action on the millennium development goals, and ahead of the G8 in July and the United Nations meeting in September, the European Council signed up to an agenda for action that reaffirms EU aid targets and sets specific milestones for the developing countries, to be achieved by 2010: increased European investment of ?4 billion to recruit 6 million more teachers, and, on health, an extra ?8 billion to help save 4 million children's lives and provide for 75 million more bed nets against mosquitoes in Africa. I will be pushing the G8 in July to ensure that we have as a world the 120 million nets that we need, so that every child in every family in the world is able to sleep safely at night. The Commission has also agreed to establish millennium development goal contracts, linking European Union spending to specific and agreed outcomes by developing countries, that will secure value for money. I am pleased to announce a British contribution of £200 million to that fund.

The Council also discussed the deteriorating political and humanitarian situation in Zimbabwe. In recent weeks under Mugabe's increasingly desperate and criminal regime, Zimbabwe has seen more than 80 killings, 2,700 beatings, the displacement of 34,000 people and the arrest and detention of Opposition leaders, including Tendai Biti and Morgan Tsvangirai. In the face of that unacceptable situation, the European Council reiterated its readiness to take further measures against those responsible for the violence. We will seek to impose travel and financial sanctions on those in the inner circle of the criminal cabal running the regime.

The House knows that since the Council met last week, the situation has deteriorated further still. As a number of African Presidents and Ministers have already stated, the regime has made it impossible to hold free and fair elections in Zimbabwe, and state-sponsored terror and intimidation have put the Opposition in an untenable position. Our thoughts are with the people of Zimbabwe, who are facing an unprecedented level of violence and intimidation from the regime. The whole world is of one view: that the status quo cannot continue. The African Union has called for the violence to end. The current Government-with no parliamentary majority, having lost the first round of the presidential elections and holding power only because of violence and intimidation-are a regime that should not be recognised by anyone.

The UN Security Council will meet later today. The Foreign Secretary will make a detailed statement in a few minutes following the discussions that he and I, and my right hon. Friend the Minister for Africa, Lord Malloch-Brown, have held with African leaders. Today, I have talked to the United Nations Secretary-General, Ban Ki-moon; to the president of the African Union, Mr. Kikwete; to the President of South Africa; and to Morgan Tsvangirai himself. Members of the Southern African Development Community and the African Union leadership will want to meet to discuss the emergency. We understand that there are plans for meetings very soon, and we support that happening quickly.

We urge that SADC observers' evaluations of the seriousness of the situation on the ground be made public immediately so that the whole world can witness the truth about what has been happening. We urge that the UN and the African Union work together with SADC to send envoys and a mission to Zimbabwe to discuss the situation on the ground and the way forward. We believe that the UN envoy should be allowed to return immediately to examine the human rights violations. The international community must send a powerful and united message: that we will not recognise the fraudulent election rigging and the violence and intimidation of a criminal and discredited cabal. We are ready to offer substantial help for the reconstruction of Zimbabwe once democracy has been restored.

The Council also expressed its ongoing concern about the humanitarian situation in Burma in the aftermath of the cyclone and called for a return to democracy and the immediate release of Aung San Suu Kyi and other political prisoners. We made clear our continued determination to play a leading role in ensuring peace and stability in Kosovo.

Our national interest is, and remains, a strong Britain in a strong European Union. We will continue to focus on an outward-looking European agenda that tackles in an effective way the global, economic, environmental and development issues that affect us all. That is what the Council sought to do at its June meeting, and that is what the Government will be doing in the run-up to the French presidency that starts in July. I commend this statement to the House.