The year ahead: 'Ministers’ ambitious international trade agenda is just about deliverable'
In our January issue, CSW asks experts to give their thoughts on the new government’s policy priorities. In this entry, David Henig looks at how the government can realise its post-Brexit ambitions for international trade
Photo: Department for International Trade
The UK government has an unashamedly ambitious trade policy agenda. By 2022 ministers want to see UK Free Trade Agreements covering 80% of the UK’s trade, which realistically must include deals with the EU (just under 50% of total UK trade) and US (around 15%), as well as concluding virtually all the rollovers of existing EU agreements to which we are currently a party.
The good news is that such an agenda is, just about, deliverable. The bad news that all FTAs create winners and losers, cover a larger range of domestic issues than almost any other government event except for a budget or spending review, and can have similarly short and long term effects on government popularity and the overall economy. Even worse, larger economies such as the US or EU generally achieve most of their asks from FTAs, and those two have conflicting demands of the UK.
Trade agreements can take many years to complete because of the need to carefully consider domestic interests while talking to a counterpart facing similar challenges. There’s an obvious potential conflict between ministers’ desire to “get on with delivery” and a civil service ethos of carefully considering policy choices. The main challenge I see for the civil service in trade policy this year will therefore be to convince ministers that effective policy making is essential to delivering their manifesto.
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In practical terms this means establishing robust cross government decision making structures at all levels, ensuring business groups, MPs, devolved administrations and other stakeholders are consulted and kept well informed with mandates, reports of negotiating progress and impact assessments, and providing clarity where possible as to the limits of what can and cannot be agreed with partners, cognisant of the probable trade-offs. The aim of all of this activity being to ensure that these FTAs effectively support UK government domestic policies, and that negotiations are not blown off course by well organised stakeholder campaigns which develop support among MPs and parts of government.
It is also important to recognise that free trade agreements are delivered on behalf of UK business, and are only one way government supports UK trade. There are other types of agreement, the slow and steady work in international organisations, and the resolution of immediate market access cases. Much to do then, all though will be helped by putting in place the right frameworks.
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