The post-Brexit vision of ‘Global Britain’ is slowly replaced by the reality that free trade agreements deliver marginal benefits, particularly for the UK’s service-oriented economy.
After Britain’s decision to leave the European Union, the government and Brexiteers argued that the UK’s new ability to cut trade deals around the world would not only compensate for any loss of access to the EU’s single market, but also free the UK to strike deals with high-growth economies in Asia and with the US. The UK government set out to quickly replace the extensive network of EU free trade agreements (FTAs) and expand it with new agreements with countries such as Australia, India and the US, as well as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) regional agreement for countries on either side of the Pacific.
Overall, these negotiations were very successful. The UK quickly established a new Department for International Trade and rapidly sealed an impressive number of FTAs between 2019-2020. When the UK left the EU customs union on 31 December 2020 it was able to largely replace the trade relations it had as an EU member with new, UK-specific ones. A very impressive 36 UK FTAs entered into force in 2021, including the EU-UK Trade and Co-operation Agreement (TCA). The UK also concluded completely new agreements with Australia and New Zealand and is set to join the CPTPP. The success of these negotiations has become emblematic of post-Brexit trade policy and helped propel then trade minister Liz Truss to the position of Prime Minister.
However, the successes of the UK’s post Brexit trading policy should not be overplayed. The vast majority of UK FTAs are continuity agreements that simply replicate prior agreements. This helps avoid disruption by preserving the status quo as much as possible but it does not give new market access. At the same time, the hoped-for trade deal with the US failed to materialise, largely because of the increasingly protectionist mood in Washington.
About the Author
Aslak Berg is a research fellow at the Centre for European Reform focusing on trade policy, international economics, regulatory policy and regional integration.