Dani Aldous bemoans ‘backsliding’ on free-trade policies as foreign secretary hits EU in last hope of letter
Boris Johnson thinks he doesn’t need business. It’s a huge gamble
Of all the people not to have reckoned with, the new foreign secretary, Boris Johnson, might have been the worst. So his “backsliding” on Britain’s commitment to “free-trade deals, regardless of the strategic circumstances” is truly unfortunate.
Such a policy, from Johnson and fellow Tory foreign secretary, David Davis, would have thought everyone would have by now signed up to.
The policy does indeed centre on reviving Britain’s relationship with the EU following Brexit. Thus exports of goods and services, notably financial services, would flourish; parliamentarians would sit comfortably in their seats; and European countries would receive greater detail and predictability on access to British government business.
Yet this policy by ministers unfamiliar with their British negotiating position, when the EU is closer than ever to an agreement than any before, might simply be seen as the final gambit in a policy designed to mitigate the potential damage to British relations with the EU after Brexit.
It’s not just “free-trade deals”; it’s also the woolly British policy of getting out of all EU social, employment and environmental regulations as soon as possible. Yes, that would be great. It would also, however, be a massive gamble. If it works, it has no consequences for the “UK”. It’s just a partial withdrawal. But if it doesn’t work, whatever savings and sanctions the Brexit transition and post-Brexit trade deals could achieve would be wiped out by losses on the financial and eurozone markets.
The euro was floated at an economically equivalent rate to the British pound because, from an economic point of view, it was the obvious solution to the stubborn inability of Britain to compete in the single currency. The inability of Gordon Brown and Alistair Darling in 2008 to mitigate that failure only amplified the challenge, with financial institutions pulling out of the UK and the pound dropping precipitously, into uncharted territory, as the ratings agencies explained in a grim study three years ago.
Free-trade treaties will be a long, difficult negotiation with the EU, not least because of the lack of European trust after Brexit.
But Britain – and, indeed, Europe – will also be curious to see how free-trade agreements can be put into effect between the UK and other countries that the EU is not about to sign up to the same “status quo” it was about to sign up to in the last decade.
The confusion is partly down to the failure of the coalition government, on its watch, to settle Britain’s negotiating position; largely because of the recklessness of the Cameron and Osborne governments, as neither adopted a clear, single, public negotiating position, and the coalition ran out of time to do so.
But an explanation also has to be found for the apparent impotence of ministers in the face of intransigence and division within the EU and national capitals. It is not just the French, they have many allies in Brussels and many equally intransigent and intransigent UK friends.
The timing of this so-called “letter” does not inspire confidence. The letter is designed as a more explicit political proposal than Johnson’s fantasy image of Mr Broadbent and/or Bob Geldof; yet it is also put out a week after the apparent difficulties of Brexit negotiations. It is not quite an ad for Johnson’s bus, but this morning it might as well be.
