Freeing Trade: what needs to be done?
Trade barriers facing UK companies have risen, and are higher in general than those facing their competitors in neighbouring countries. While new Free Trade Agreements with Australia and New Zealand are in the process of being implemented, few are expecting to make significant use of them.
Small companies have been particularly affected by the new paperwork required for trade with the EU and other countries linked to its single market and customs union. Impacts have come whether importing or exporting goods, or for inward or outward movement of people to support their business.
Modern trade barriers are often complex regulatory differences rather than tariffs. Prioritising and tackling them is a challenge for all countries, measuring success and improving performance just as difficult.
Questions under discussion
What should be the immediate priorities for the UK government in addressing the many trade barriers faced by UK businesses?
Do trade-offs exist between efforts to boost trade both in the region and globally, and if so how can these best be handled?
How can we best measure the success of efforts to free UK trade?
Policy Options
Trade Unlocked 2023’s policy partner, the UK Trade and Business Commission, has recently published a comprehensive report containing policy recommendations to the UK Government. Freeing UK trade runs through the report, with all recommendations in some way linked to this.
Policy options to improve the Trade and Cooperation Agreement are kicked off by ‘a general policy of regulatory alignment with the EU’, and a new cooperation forum called the ‘UK-EU Regulatory Cooperation Council’. Included within this is also membership of the Pan-Euro-Mediterranean convention on rules of origin which would remove some barriers with the whole neighbourhood.
Recognising that the US is our single largest trade partner, the report suggests the UK ‘work to strengthen its Transatlantic dialogue with the US and seek agreements on digital trade and financial services regulatory cooperation’. Other recommendations cover the possibility of new agreements as well as prioritising market access cases, while ‘Ensure[ing] UK border and customs processes are efficient’.
In terms of direction and oversight, Recommendation 100, ‘develop a trade strategy including policy trade-offs and agreement priorities’, would then be subject to oversight from the newly established UK Board of Trade. In particular ‘The UK Board of Trade should collaborate with relevant parliamentary committees to analyse and assess the costs and benefits of different trade policy options and provide evidence-based recommendations to the UK Government’ and ‘The UK Board of Trade should produce a comprehensive annual trade report, modelled on the US and EU trade reports, and which assesses the UK’s trade policy developments’. There would then be scrutiny in Parliament, in particular ‘an annual debate on the country's trade strategy and performance, based on the UK Board of Trade's annual report.’