Dr. Rebecca Harding

CEO Coriolis Technologies

By rights, the upcoming UK election should be an election about trade. “It’s the economy, stupid” was the message that won Bill Clinton the US presidency during the then-prevailing recession. And if economics matters to the British voting public, then this should be the one that counts.

Economists are queuing up to say how much lower growth is now compared to where it would have been had the UK not voted to leave the EU. The British people should be worried about the long-term security of their jobs and livelihoods, as investment and productivity growth slows to a crawl, nominally because of the uncertainties around the terms under which the UK will leave the EU.

However, they aren’t, and there are really good reasons why.

Trade is complicated and dull. It doesn’t win votes. Populist politics has conflated it with the inequality and insecurity that is inherent to globalisation. How, then, can it be used by politicians as a vehicle to win people over to their respective camps? Who really cares about rules of origin in post-Brexit supply chains? Does anyone wonder to themselves as they pore enthusiastically through the various manifestos what, say, the Liberal Democrats’ policy is on investor-state dispute settlements?

As a result, we have the “Get Brexit Done” manifesto, the “Bollocks to Brexit” manifesto and the “Let the People Decide” manifesto. Trade has been boiled down to the simplest soundbites and promises. We’ll “sort out the post-Brexit trade agreement” by the end of 2020; we’ll “get a better deal and put it the people”; we’ll “revoke Article 50 altogether”. Small wonder then, that there is a weariness with the whole thing, matched only by an even larger weariness about the fact that there is an election to sort this out because the politicians themselves couldn’t.

Howsoever understandable this attitude is amongst the voting public, now is not the time to admit defeat on trade. Trade is what businesses do, whether it is domestic or international. Without it, there is no economy. Whether the consequence of the heady days of globalisation has been to create an unequal society at home and across the world or not, laying the entirety of the blame at trade’s door is simply wrong. Trade is simply how one company interacts with another – how goods and services transfer hands and how jobs are created. The innovations, the technology and the finance that enable trade are just that – enablers.

Businesses do not set out deliberately to create inequality; those come from the unequal opportunities across the UK and across the world such as access to training, education, healthcare, and clean water or food. Funnily enough, these are also the principles of good government. In other words, it is businesses that should be getting on with the trade job while governments focus on the issues that really do keep people awake at night – like their health or their income or their qualifications.

Government has a responsibility to explain why trade matters to individuals. It has monumentally failed to do so.

Opinion polls suggest that the current agreement with the EU will go through parliament in January, so that the UK leaves the EU on the 31st. However, Brexit will be “done” in name only at that point – the trade negotiations of the following few months will determine just how the UK trades with Europe. Will there be a “level playing field” to ensure that businesses can compete fairly across the continent, or will “regulatory divergence” mean that the UK’s businesses will have new rules to work with? What will those new rules be? How much will it cost? Will businesses need to comply with EU rules to trade with the EU and different rules to trade with the US?

Above all, the question that both politicians and voters should be asking themselves is what the future should look like. This has been the unanswered question throughout the Brexit process. No politician from any side of the debate has convincingly provided the average voter with a compelling vision of the UK after January 31. Trade should be a critical part of this, not just because it is what companies do, but because in a world of trade wars and protectionism, trade has become a key part of the national security debate.

 

This is in the end what voters are not being told. They are being left to assume that the technicalities of trade can be dealt with, and that the politics of Brexit mean that getting it done either way is more important than dealing with the consequences. Such an attitude marks a complete disintegration of the relationship between voters and politicians. There is little to believe in, only a hope that the pain will stop soon one way or another. It is hard to understate how damaging to democracy this is.

MultiLateral Thinking is the go-to source of data-based analytics and advisory for the trade finance sector. Bringing together the finance, business, national security and academic worlds, MultiLateral Thinking works to give a collective, independent voice to all entities involved in trade and trade finance. To become a MultiLateral Thinker, contact Duncan Keil, director of business development.