The Government has promised to publish its trade strategy in 2025, and leading think tank the Institute for Public Policy Research (IPPR) has now set out its assessment of the main areas and issues which the strategy will need to address.
Given unprecedented global trade volatility and the need to reverse a declining goods trade performance, it urges the Government to introduce urgent reforms.
Towards a UK Trade Strategy, available HERE, highlights the possibly disruptive effect of the return of President Trump to the White House given that he is threatening to impose a range of tariffs on imported goods and to increase economic tensions with China.
The Prime Minister should, the IPPR has advised, signal openness to a trade deal with the United States but must also boost trade defences to deter against economic threats. This would include developing a legal mechanism to introduce counter-measures — including tariffs — in response to attempts to coerce the UK economically.
IPPR associate director, Marley Morris, said: “The challenges are stark: declining goods exports, damaging barriers with the EU and a turbulent global economic landscape. But a new strategy should help develop a new programme of export support, rebuild UK–EU trade relations and modernise our approach to trade agreements.”
With regard to relations with the EU, the report notes that the consequences of Brexit are still having a profound impact on UK trade.
Between 2021 and 2023, it states, estimates suggest that EU goods imports to the UK were down by 32% and UK goods exports to the EU were down by 27%, compared to what would have happened if the UK had not left the EU.
The IPPR calls on the Government to link the UK and EU systems for emissions trading to remove new barriers for UK businesses, by avoiding the EU’s carbon border adjustment mechanism (CBAM) (see Government seeks views on a carbon border adjustment mechanism HERE).
