International trade deals won’t transform the UK economy and the government will not be able to deviate much from EU and US regulation in spite of Brexit.
That is according to David Henig, UK Trade Policy Project director at the European Centre for International Political Economy (ECIPE).
Henig told the Business Travel Association (BTA) conference in Liverpool: “Most trade deals are not going to transform things. A large part of trade deals is showboating.”
But he insisted government references to “global Britain” do express a reality.
Addressing the BTA as Prime Minister Boris Johnson prepared to meet US President Joe Biden to discuss an eventual US-UK trade deal, Henig said: “Free trade deals are not really about free trade [and] the government will do the deals regardless of whether there is anything useful in them.”
He told the BTA: “A trade deal is a collection of issues that might be useful to some people. The question is how do you make sure these deals include stuff useful to you. [But] the most important thing is the dialogue.”
Henig warned: “We’ll have tricky relations with the EU. We decided to leave [and] for now things are too restrictive.
“We were close [and] now we’re distant. The checks at borders are not great, but these things can change. It’s not static. It’s a bit like after a divorce.
“But most regulations are still going to have to be aligned with the EU or US.
“What is wrong, he said, is “people can’t get here [to work] and we’re trading less goods with Europe now. It will be very difficult to make up for that.
“Delays at the border make it harder and will probably have an effect on the trade figures.”
He added: “We’ll also have tricky relations with Scotland and Northern Ireland.
“The question is, will the government help rather than hinder? There is a danger the government responds by doing things that make it even worse.”
Henig declared himself “not impressed” with the government, saying: “At times, the UK government feels like a secret society which no one knows how to enter.
“The problem is that the Prime Minister is not interested in detail, he is interested in catchy headlines. Ministers are not rewarded for delivering detail. Their job is to get good headlines, not to be competent.”
But he argued: “In the last 18 months we’ve seen the importance of working with government. We need a dialogue [with government].”
Of Johnson’s trip to the US, he said: “We think the US is the answer to all our problems and it’s not. About 16% of UK exports go to the US. We can’t make them do what they don’t want to and they’re turning inwards as well.
“We need to keep the relationship, but we can’t rely on the US. Biden is narrowly focused on the US domestic economy and on China.”
But Henig insisted the government slogan of ‘global Britain’ “is a reality as well as a slogan”.
He explained: “Britain is the fifth-largest economy in the world, the eighth-largest exporter of goods, and in services we’re a superpower.
“Britain is the second-largest exporter of services in the world – we’re half the size of the US [in service exports] with one fifth of the population.”