The UK faces a very busy trade policy agenda over the next few years, featuring negotiations with the EU, and with other global partners. Modern trade negotiations span a large number of sectors, and in each, the question of regulation is central. This in turn means that the payoffs from negotiations need to be viewed through a wider prism than just their effects on flows of trade and investment. And because different partners vary in their approach to public policy, decisions made by the UK to pursue deeper integration with one partner rather than another present complex choices about approaches to public policy.
These questions and many more were discussed by a panel chaired by Lord Gus O’Donnell, former cabinet secretary, and speakers Professor L. Alan Winters and Dr. Emily Jones.
The speakers noted that the current trend in the UK was to reduce the role of parliamentary involvement in trade matters. This in part reflected the government’s view that trade negotiations, particularly with the EU, need to be done quickly. This approach is not necessarily to the UK’s advantage. From a bargaining perspective, negotiators can use the threat of parliamentary constraint in order to signal the limits to the concessions they are willing to grant to their counterparts. Whereas signalling that time is short might reduce negotiating leverage. From an economic perspective, allowing more time creates the space to ensure that a strategy on international trade is sufficiently developed and evidence-based, enabling government to identify priorities, and also the potential losers from trade reforms. It would also enable trade policy objectives to be better aligned with other important strategy areas, notably industrial strategy, and green growth, and the UK’s geopolitical positioning.
The speakers also emphasised the importance of broadening participation in trade policy formulation beyond parliament and government departments to include civil society, expert groups and industry. Experts, notably economists, needed more humility and needed to invest more effort in communicating their findings to the public.
See Professor L. Alan Winters’ slides from the event here.