UK 'must look to Indo-Pacific trade'

The UK should pursue new trade deals with large and fast-growing economies beyond Europe, particularly in the Indo-Pacific, according to a new government report.

Cargo ship at sea
Produced by the Board of Trade in London, the 'Global Britain, Local Jobs' report also calls for the nation's standing as a global hub for services and digital trade to be boosted; and for more post-Brexit support to help businesses internationalise.The report argues that the UK should follow the likes of Australia, Singapore and New Zealand in employing trade liberalisation policies to spur growth.

Global growth forecast

It forecasts that 90% of global growth over the next five years will be outside Europe and points to estimates that almost two-thirds of the world’s middle classes are expected to be located in the Asia-Pacific region by 2030.International Trade Secretary Liz Truss said, “This report shows how 'Global Britain' will deliver jobs and growth across the UK, particularly in areas like the north-west and north-east of England."Export-led jobs are more productive and higher paying, but currently too few businesses export and our economy would benefit from being more international. This potential can be liberated through more trade deals, boosting our role as global hub for digital and services trade, and by pursuing policies that drive an exports-led recovery.“The opportunity we have as an independent trading nation is huge. Today’s report outlines how we can do things differently and capitalise on defining trends like the emergence of Asia’s middle classes and rapid growth in the Indo-Pacific.”

CBI wecomes the report

The report's findings were welcomed by Andy Burwell, director for international trade at the Confederation of British Industry, who said, “Trade offers the UK a powerful route to post-pandemic recovery for the whole country – supporting the levelling up agenda and a green economy."These recommendations need to form an important part of the new export strategy, supporting an economic vision which enables businesses of all sizes to export and invest.”The report also calls on ministers to deliver on their election pledge to cover 80% of UK trade with free trade agreements by the end of 2022 by concluding existing negotiations with the US, Australia and New Zealand.

Damage from Covid-19 pandemic

Linda Yueh, an economist and adviser to the Board of Trade, pointed out that the damage from the Covid-19 pandemic had been considerable."Trade can help with the economic recovery and create jobs across the country as set out in the study that accompanies today’s report. It’s thus important that the UK promotes fair and free trade to open up opportunities for our businesses and work with partners to improve the global rules-based system,” she said.Publication of the report coincided with the release of government-commissioned research by the Fraser of Allander Institute at the University of Strathclyde, showing that almost 6.5 million UK jobs were supported by exports.The research indicated that exporting companies were 21% more productive than others, and that median wages in jobs directly and indirectly supported by exports were about 7% higher than the national average.

Read more news and views from David Sapsted.

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