"Securing future agreements will require a willingness to accept trade-offs." Photo: Andrew Matthews/PA Archive/PA Images
The UK has enjoyed many benefits from international trade as a member of the EU, and I continue to believe that remaining in the world’s largest free trade area provides the best means of taking advantage of global opportunities. But, as chair of the International Trade Committee, I have also considered how best to ensure the UK can continue to trade effectively after Brexit.
Much has been made of potential new post-Brexit trade agreements with countries such as the US, Australia and New Zealand. This ignores, however, that as an EU member the UK currently benefits from over 40 free trade agreements with around 70 countries (which together account for more than 14 per cent of UK trade). A central aim of the Department for International Trade (DIT) has been to “roll over” agreements so that the UK has similar terms of trade with these non-EU countries after we leave. So far, DIT has only signed 13 such deals and has failed to conclude them with such significant trading partners as Canada and Japan. Securing further agreements will be key to the UK’s continued trading success.
When it comes to new agreements, my committee has heard that Brexit—especially a no-deal scenario—presents opportunities for the UK to demonstrate greater flexibility and speed when conducting future negotiations. That is particularly relevant in the case of the proposed UK-US agreement.
But this may only yield a 0.2 per cent increase in GDP compared to the potential 8 per cent fall resulting from leaving the EU. It’s essential that such an agreement does not compromise the universal access to healthcare provided by the NHS or lead to lower food standards.
Securing future trade agreements will require a willingness to accept trade-offs, and a lot of time. Unless the government has a transparent and inclusive trade policy, and is clear on its objectives, it will struggle to secure support from both parliament and wider society. This is particularly pertinent given that the government is yet to publish its responses to consultations on future trade relations with the US and others, just weeks before negotiations could commence. Lack of openness can derail trade deals—seen clearly in the troubled TTIP negotiations between the EU and US.
Trading opportunities are often not secured through new agreements themselves, but work on the ground undertaken by the UK’s global network of overseas posts, promoting British businesses abroad and gathering information. It is surprising that the government has made cuts to this area in recent years.
If Brexit leads to major economic damage then taking advantage of every available global trading opportunity, and the UK government dedicating all necessary resources to doing so, will be essential to securing the UK’s future prosperity.
Read Conor Burns on why new deals must benefit every corner of the UK
