
The UK is in a great position for trade talks, it cannot be wasted
The UK has already made great progress so far with regards to agreements on future global trade. It cannot allow the kind of unnecessary controversy that has dogged the Australian trade deal to accompany every subsequent deal, writes John Baron MP.
Since Britain left the European Union at the end of January 2020, the Department for International Trade has been hard at work across the world. Despite the challenges of the pandemic, DIT has struck agreements with over 60 countries as the United Kingdom emerges out of the shadow of the EU Customs Union and resumes its status as an independent trading nation.
For many of us, reclaiming this status was a key reason for backing the UK's departure from the EU. Reducing or eliminating trade barriers and slashing tariffs benefits everyone, but the European Union does not have a distinguished record when it comes to striking free trade agreements. The difficulties of accommodating competing interests across 28 individual member states means a tendency towards the lowest common denominator, and all too often to no agreement at all.
This is the main reason that the EU's flagship trade deal with the United States – the Transatlantic Trade and Investment Partnership – ran into the sand, despite the potential for the largest bilateral trade deal in history. The EU still does not have comprehensive trade agreements with a clutch of major economies, and even striking a deal with Canada, a close ally with a similarly strong commitment to high standards and values, nearly fell foul of the machinations within the Walloon Parliament and only just limped over the line.
Whilst the trade deals the UK has so far signed represent 'rollover' deals replicating EU agreements – though the UK-Japan trade agreement went further in a number of areas – the Government is poised to sign new free trade agreements with Australia and New Zealand. These are breaking fresh ground and will serve as important test-cases for our future international trading relationships.
If necessary, the Government must put on its tin hat and press ahead with signing a zero-tariff, zero-quota agreement with Australia, and it is unfortunate that this first trade deal has become mired in controversy about the possible (but very unlikely) impacts on our farming sector. The Government is at pains to point out that there will be no watering down of our high animal welfare and food production standards and, put simply, if we cannot sign a free trade agreement with a like-minded and similarly democratic country with whom we also share a Head of State, then we may as well give up on pursuing trade agreements in future.
As the Australian High Commissioner has been at pains to point out, there is no possibility that a free trade agreement between our two countries will lead to the 'flooding' of the British market with Australian beef and lamb. Almost all Australian meat exports go to the burgeoning Asian markets, not least because exporting meat half-way around the world to the UK is considerably more expensive than shipping it to growing markets and economies much closer to Australia. There are also the very significant upsides of easier access to Australian markets for our high-quality British products.
People should also not lose sight of the fact that governments can always choose to protect those sectors which in their view require support, although it should be food for thought if certain sectors require protection in order to hold their own. If the NFU is correct in its assessment that this mild Australian free trade agreement represents the death-knell of British farming, then this does not reflect well on our farming sector.
In addition, there has also not been much criticism in this respect of the free trade agreement with the European Union we struck in December, and if anything, it should be EU producers concerned at the prospect of losing UK market share. Those who would re-join the EU in a heartbeat should bear in mind that the EU has recently concluded trade negotiations with Mercosur, the South American trade bloc, where a number of countries are well-known for exporting rather a lot of beef. It is a strange position to hold that tariff and quota-free trade is good with the EU, but not with the rest of the world.
Striking good trade agreements with Australia and New Zealand also smooths the path to Britain joining the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, a trade area which accounts for £9 trillion of trade and which generates 13% of the world's income. Breaking into this market will reduce trade barriers and slash tariffs for a huge range of British products, and it is a trading prize towards which the Government should strain every sinew.
The politics of trade agreements wrongly give rise to concepts of 'winners' and 'losers', when in truth everyone benefits from lower tariffs and reduced trade barriers. Not many consumers will complain about lower-priced products, and the insights of David Ricardo suggest many sectors will thrive in such circumstances. As a newly-independent and agile trading nation, the UK has a bright future ahead of it – if governments are willing to embrace it.

John Baron is the former Conservative MP for Basildon and Billericay and a former Shadow Health Minister.