Great Britain needs new trading partners after Brexit.
(Photo: dpa)
London Since Brexit was implemented two years ago, the British government has been searching for new trading partners around the world under the keyword “Global Britain” in order to demonstrate the economic advantages of leaving the EU. The then Prime Minister Boris Johnson spoke of “huge opportunities”.
Among other things, the British want to join the Pacific Trade Pact CPTPP. However, the difficult negotiations with the eleven countries bordering the Pacific show how far apart the desire and reality of “Global Britain” are.
Of the 71 trade deals Britain has signed since leaving the EU, 68 were more or less a copy of the arrangements it had before as a member. Only three new free trade agreements with Japan, Australia and New Zealand have been added so far.
So far, the economic benefit has been manageable: trade with Japan has even declined in the first twelve months since the deal was signed. According to former Environment Minister George Eustice, the Australians ripped off the British negotiators in the deal with Down Under. Talks with India are faltering, those with the US have not yet started. And the accession negotiations to the CPTPP pact are becoming an obstacle course.
“Negotiations on the UK’s accession to the CPTPP are ongoing,” the UK Department for Economic Affairs and Trade said on request. The government has always made it clear that Britain’s high standards of food safety and animal welfare will not be compromised. “Our joining of the CPTPP will come on terms that are right for UK businesses, consumers and farmers.”
Dispute over Canadian beef and Malaysian palm oil
At the beginning of the negotiations in 2021, it sounded even more euphoric: At that time, the Department of Commerce in London announced that Great Britain’s accession would “increase the economic clout of the CPTPP” and that the Kingdom would “move into the center of a dynamic group of countries as the global economy increasingly expands focused on the Pacific region”. The euphoria has now evaporated in the dispute over import quotas for beef from Canada and palm oil from Malaysia.
Although the accession negotiations have not yet been completed, the government in London is said to have bowed to Malaysia’s demands and wants to waive an import tariff for palm oil. Not only are environmentalists in Britain up in arms about this, the island kingdom is also distancing itself from the EU, which wants to ban the import of palm oil if it means that forest areas important for nature conservation and climate protection are cut down.
There was also a dispute over beef imports from Canada. Canadians want the same free access to the UK market that Australians and New Zealanders previously got. However, the British negotiators are breathing down their own farmers, who have already been annoyed about the permissive deal with Australia and New Zealand.
If the British initially thought they would be welcomed with open arms, they are now realizing that their old colonies in particular have nothing left to give away. The British have always been overly optimistic about the times and challenges, Jeff Schott, a trade expert at the Institute for International Economics (IIE) in Washington, recently stated.
The conservative government wants to join the Pacific Trade Pact CPTPP. However, the economic benefits are limited.
(Photo: Reuters)
Given the modest economic benefits of joining the CPTPP, the struggle is obviously more symbolic than economic. According to its own calculations, the British government only expects a boost of 0.08 percent for gross domestic product from the new trade agreement. For comparison, according to estimates by John Springford of the Center of European Reform (CFER) think tank, Brexit has depressed UK GDP by 5.5 percent by the second quarter of 2022.
Subsidy dispute with the USA
Elsewhere, too, “Global Britain” is making little progress. Trade talks with India are faltering and negotiations with the US have not yet started. US President Joe Biden has refused to discuss trade facilitation with Britain until London settles its dispute with the EU over Northern Ireland.
Although this hurdle has now been cleared with the recently agreed “Windsor Framework”, new obstacles are piling up with the gigantic support package from the US government for the green transformation (IRA).
In the British capital, people have now noticed that they are falling by the wayside in the industrial subsidies race between the USA, the EU and China. Trade Minister Kemi Badenoch has criticized the planned US state aid as “protectionist” and now wants to react to it together with “like-minded countries”. In addition to Japan, South Korea and Switzerland, the conservative politician also expressly mentioned the EU.
More: Europe counters the subsidy policies of China and the USA