A former Assistant Director at the Department for International Trade sounds the alarmby David Henig / May 18, 2018 / Leave a comment
It was easy to miss among the continuing dreary and slightly surreal chatter of customs solutions and Northern Ireland, but we recently saw something perhaps unprecedented in the history of UK trade policy. For the first time ever business groups, trade unions, and various interested NGOs came together to agree on something.
This wasn’t the usual pro-trade agreement position that you could expect from the likes of the CBI, IoD, and often the consumer organisation Which. Nor was it the scepticism about trade agreements and a demand for more equitable provisions you’d normally associate with trade unions or the Trade Justice Movement. We can expect such a division to come back to this soon if the UK does regain full control over our trade policy.
The subject on which all these organisations could agree was, rightly, “a stronger emphasis on consensus building and accountability” in UK trade policy. A document, “A Trade Governance Model That Works for Everyone” was the output, suggesting what the UK government needs to do to make this happen. The central point is to ensure stakeholders are left “feeling their contributions are really heard and fully considered…”
What lies behind this document, if not explicitly stated, is widespread disaffection with the way the UK government, and particularly the Departments for Exiting the European Union and International Trade, are consulting, or failing to consult, stakeholders. I speak to a lot of UK trade policy stakeholders, and it does not take long for them to voluntarily raise this as their main gripe. They simply don’t feel the government cares what they have to say, and they are starting to get suspicious that whatever is being said by UK politicians and officials to other countries does not reflect their interests.
If this carries on the UK’s entire trade policy agenda is in jeopardy. To understand why, let us recall the story of the Transatlantic Trade and Investment Partnership, the legendary TTIP, how it nearly brought down at least two other trade agreements, and in particular the role of the EU Trade Commissioner, Karel De Gucht, who oversaw the start of talks.
TTIP talks started, as most trade talks do, in a blaze of optimism in June 2013. It was going to be finished in “one tank of gas” or more specifically prior to the 2016 United States Presidential election. It didn’t however take long for some of the more sceptical groups, such as some of those above, to start raising concerns. That the NHS could be at risk, that the US might have too much influence in setting EU regulations, or elsewhere in Europe various different concerns.
“The Department for International Trade would do well to learn from history and start engaging properly now”
Now the EU has a long history of concluding trade agreements, and could point to the fact that none of these had led to such terrible things happening. Then again none of the trade agreements had been with the US, and the phrase “US multinational” is often associated, fairly or not, with predatory capitalism. Together with the inclusion of investment arbitration not previously included in EU agreements there was plenty for sceptical groups to work with.
Commissioner De Gucht did not make much of an attempt to win friends among these groups. He was not in any case known as a diplomat, with opposition figures claiming his biggest achievement as Belgium’s Foreign Secretary was “that he didn’t get Belgium into a war.” As TTIP controversies grew he accused the Green Party in the European Parliament of lying about the deal, and equally did not take kindly to those who questioned his use of the most optimistic growth projections. Opposition to TTIP grew across Europe, and many also started to question the CETA deal with Canada and the Trade in Services Agreement (TiSA), as a kind of unholy trinity.
In late 2014 a new Commission followed the election of the new European Parliament, and the rather more emollient Swedish liberal Cecilia Malmstrom took the trade portfolio. Malmstrom worked hard to repair relations, striking a much more conciliatory tone while still emphasising free trade. It was still a close run thing though, as the EU-Canada Free Trade Agreement only just survived through skilful handling, while TiSA, which could have had significant benefits to the UK as a multilateral deal focused on services, foundered at least in part due to the opposition.
So back to the UK. We have a bunch of unhappy stakeholders, in Liam Fox a figure who has dismissed opponents of free trade as perpetuating “myths and wilful distortions,” and we’re about to start talks with the US. Meanwhile the Department of International Trade has still to come forward with any proposals for consulting stakeholders or parliament, has not said what our priorities would be in trade talks, and has appeared to suggest that the US will do a trade deal with the UK without talking about our favourite agricultural topics, chlorinated chickens and hormone treated beef. In these circumstances, unless spectacularly well handled, it’s easy to see how a protest against a US trade deal could spread to trade deals more widely. This could include business, trade unions and NGOs, as they are by now used to working with each other.
The Department for International Trade would do well to learn from history and start engaging properly now. If not, the brave new world of trade agreements could turn dystopic rather quickly.