04 Nov 5 things we learned from Liz Truss’ speech setting out her UK trade policy vision
On the 29th October, Secretary of State for International Trade, Liz Truss, gave a keynote speech to set out her vision for the UK’s global trading policy – calling for trade to be ‘firmly anchored in Britain’s core values’. It has been a turbulent first year of the UK’s new independent trading policy, as we have moved towards our departure of the European Union, with the highs of early successes – such as the UK-Japan agreement – matched by a bruising political debate around emotive issues, such as the future of the UK’s agricultural standards.
Here are five things we learned from the speech about how the Trade Secretary seeks to take her brief forward:
1. The UK will not pursue a “Britain First” approach to free trade. In a rebuke to the slogan pursued by US President Donald Trump in his rather aggressive reframing of American trade policy, Liz Truss ruled out “an autarkic Britain First approach” to trade – suggesting that the UK will approach its trading policy as a mutually beneficial collaboration between partners. She argued that the UK is learning “from the twin errors of values-free globalisation and protectionism” but must balance this against the inherent importance of trade, in and of itself, as “a lean, green, value-creating machine”. Truss gave scant detail of how the UK’s trading policy will address concerns citizens hold about globalisation, or how it will be balanced with other domestic economic policies.
2. Values will be at the heart of the UK’s trading policy. The overwhelming message that Truss sought to convey was that the UK’s trading policy will be “values-generating” and “values-driven”. By this, she means that not only will the UK Government only pursue agreements in line with its own values, but that the UK will also seek to spread its fundamental values – defined as “sovereignty, democracy, the rule of law and a fierce commitment to high standards” – through its trading policy. However, in practice, a values-based trade policy may prove difficult to achieve, especially in light of the combined economic and political pressures created by Brexit and the coronavirus pandemic. For example, the UK is said to be “very close” to securing a free trade agreement with Turkey, whose recent aggressions in Syria, Libya and the East Mediterranean, and its belligerence towards France following a spate of recent terror attacks, challenge the legitimacy of the values-first argument.
3. The UK will seek to challenge China on trade. Although Truss made no direct reference to China, in a number of thinly-veiled comments she repeated criticisms often levied at China, criticising states who “artificially promote state-subsidised products” and engage in forced technology transfer. She argued that “mistakes when the World Trade Organisation allowed new and large economies to join in the early 2000s without being subject to the same disciplines as existing members.”. As such, she committed to using the UK’s G7 presidency next year “to lead the global fightback for free and fair trade, challenging those who won’t play by the rules”. However, as ever, the UK’s willingness and capacity to challenge China as a global trading actor will be tempered by the careful balance to be struck in maintaining positive economic relations with the authoritarian state and keeping China ‘at the table’ on climate change – a key UK foreign policy priority.
4. The UK Government recognises the need to build public support for Free Trade Agreements. Pointing towards the three million signatures that were gathered in Europe opposing the EU’s ascension to TTIP, Truss highlighted the importance of building trust and public support for free trade. She also criticised politicians for not “fully engaging in the concerns the public have”. BFPG research shows that whilst Britons are broadly supportive of free trade and globalisation, they have an extensive range of concerns including over the impact on the NHS, food standards, workers’ rights and animal and environmental protections. The Trade Secretary was seeking to signal that HMG will be looking to build some form of engagement into its trade policy machine.
5. The UK Government continues to resist legislative guarantees for the standards it promises to protect. Truss spelt out explicitly where the UK Government believes the red lines for securing free trade agreements will fall. She pledged that the “NHS remains off the table”, that “food standards must not be undermined and British farming must benefit” and that “any trade deal must help ‘level up’ our country”. However, she refused to impose “blanket bans on any food produced differently from the UK” arguing that to do so would have a “devastating effect on economies which we want to see benefit from free trade”. Activists and many citizens remain suspicious as to why the Government is resisting efforts to enshrine standards in legislation, and this area is clearly going to remain one of the most contentious and difficult communications aspects of the UK’s trade policy moving forward.