As the UK leaves the EU, for the first time in more than 40 years it will be in charge of its own trade policy.
Success in trade and investment is vital for national prosperity. And, contrary to many predictions, the first year since the referendum saw a record 2,265 inward investment projects in the UK, an increase on the previous year.
Our exports continue to grow year on year. Countries such as South Korea and Japan are now fast-growing markets for UK exports, while Britain’s trade deficit with the EU widened to £60bn in the 12 months to September 2016.
It’s no surprise — even the International Monetary Fund predicts 90 per cent of global growth over the next 20 years will come from outside Europe.
The tectonic plates of the world economy are shifting. With an independent trade policy, Britain can put itself in a strong position to benefit, opening up access to fast-growing markets across the world. So we need to be prepared.
Earlier this week, the government introduced the Trade Bill to provide a framework for preserving existing trading relationships, including agreements we are already part of under the EU.
Combined with the forthcoming Customs Bill, this will help to minimise disruption to imports and exports, whatever the outcome of our negotiations.
This is a clear signal of our commitment to a “global Britain” with free and open trade at its heart.
The department of international trade has already established 14 working groups with 21 countries from the USA to Japan, India and Australia, to explore the best ways to progress our trade and investment relationships.
Of course, trade can only prosper within the right global environment. The established order of free, fair and open commerce is not something we can take for granted.
So as we regain our independent seat at the World Trade Organisation, of which we were a founding member, we will use our position to resist attempts to put up barriers to business, including by G7 and G20 countries that are turning their back on the principles that made them rich and powerful.
The economic and moral reasons for doing so are compelling. During the 1990s, per capita income grew three times faster in developing countries that lowered trade barriers, compared with those that did not.
The result was drastically reduced poverty in those countries and increased global prosperity. All the aid programmes in the world, even ones as generous as our own, come nowhere close to the ability of free trade to reduce poverty.
Now is not the time to pull up the drawbridge and retreat into the failure of protectionism. Trade drives prosperity, which in turn underpins political stability and security. This commitment to free trade has played a central role in British economic and foreign policy for decades and that will continue.
Of course, free trade cannot mean a free-for-all. Therefore, the UK will create a new independent trade remedies body to ensure that its businesses compete on a level playing field, defending them from unfair trade practices or unexpected surges in imports.
For the first time in more than 40 years, the trade concerns of the UK will be represented by the UK. This is an unprecedented opportunity to create a trade policy that works for everyone in Britain, one that boosts British businesses and workers and puts more pounds in the pockets of British consumers.
In the months ahead, there will be those who say that this task is too hard, and that our country is not up to it. But that’s what they said in the early 1980s.
Then the government of Margaret Thatcher took on the power of the trade unions, tackled Britain’s failing state-owned industries, championed a capital-owning democracy and ushered in a new era of prosperity. With resolve and imagination we can now help shape a global trading environment fit for the 21st century.
Source: Financial Times