Future Free Trade Agreements

Deidre Brock Excerpts

Thursday 21st February 2019 Commons Chamber

[Dr Fox]

No. The countries in the CPTPP have been quite clear that they want to finish the ratification process for the 11 countries that are already in the partnership before they consider potential new entrant countries. They have yet to decide whether they want to consider individual countries or to group countries in a timetable for accession. We have simply made it clear that we have an ambition to join the partnership. We have a long way to go in determining what that would look like in respect of both timescale and content.

I am delighted to report that both Australia and New Zealand have shown strong political will to negotiate such agreements. Australia is the 13th largest global economy and has been a flourishing nation in recent times, with an excellent record on GDP growth, and trade already worth some £15 billion per year.

The UK is the second largest investor in Australia while Britain is the second largest destination for Australian overseas investment. Our countries established the UK-Australia trade working group in September 2016 and since that time it has met regularly to lay the foundations for future FTA negotiations in addition to discussing wider trade issues of shared interest. I believe that we can look forward to those discussions with confidence.

Similarly, New Zealand and the United Kingdom enjoy extremely close economic ties. The UK is New Zealand’s largest export market in the European Union. New Zealand exports more goods to the UK than to Germany, France and Italy combined. We are also the largest EU investor in New Zealand. The UK and New Zealand are both ranked in the top 10 countries for ease of doing business and we already boast a strong trade relationship, with UK-New Zealand trade worth around £2.8 billion.

The UK-New Zealand trade policy dialogue has been working since September 2016 to determine how we further strengthen our trade and investment relationship and to prepare the groundwork for the launch of bilateral FTA negotiations. An FTA with New Zealand would be an opportunity to set an ambitious precedent for future agreements and to build our relationship with a key ally in multilateral forums. It will give us the opportunity to pioneer modern and enduring trade rules, to update the global rulebook and to identify where we can collaborate to promote free, fair, rules-based trade in markets around the world.

Free trade agreements also give the United Kingdom the opportunity to design new modern trading rules that play to our unique strengths. To ensure that any future FTA works for the whole of the UK, the Government have sought views from a broad range of stakeholders from all parts of the UK. The Government’s proposal, published last year, set out our approach to pursuing new trade agreements collaboratively by engaging the widest range of stakeholder groups. We are committed to an inclusive and transparent trade policy that benefits the whole of the UK.

We are also creating a new strategic trade advisory group, which will advise Department of International Trade Ministers and trade negotiators on trade policy as we move forward. The group will be co-chaired by the Minister for Trade Policy and we are now finalising the selection process for membership. I will shortly write to the successful candidates, with an announcement to follow. This group is composed of core members, representing a diverse range of interests and expertise, drawn from different groups—from business and the trade unions to consumers and non-governmental organisations among others—but all with an interest in our future trade policy and its impact on the full spectrum of issues facing the UK, from the workplace to consumer choice and the environment. The membership of this group, with its balance of interests and representation from across the UK, is designed to allow the Government to harness advice, insight and evidence from a cross section of experienced voices already actively involved in trade-related issues.

[Deidre Brock (Edinburgh North and Leith) (SNP)]

I thank the Secretary of State for giving way. Let me go back to the issues around Australia—as an Australian this area is of particular interest to me. The Japan-Australia economic partnership agreement took seven years from start to finish to establish. How long does the Secretary of State estimate it will take to establish a similar agreement with Australia?

[Dr Fox]

At the other end of the scale, the Australia-US trade agreement was an extremely short one to negotiate. So where there are compatible economies, it is possible to do that. I spoke to my Australian counterpart yesterday, and we hope that, given the openness of our economies and their compatibility in terms of shape, we will be able to conclude an agreement as soon as possible. There is no way, in advance of a negotiation, to say how long it will take. At the beginning of this process, our Australian colleagues are likely to be involved in a general election, which may mean that it will be slightly later when we can get into the process, but I hope to be able to conduct bipartisan negotiations with them to ensure that we can make progress as quickly as possible, which is in our mutual interest.

On 20 July 2018, we launched four online public consultations, providing the public with an opportunity to give their views on potential future trade agreements with the US, Australia and New Zealand and on accession to the CPTPP. All four consultations were open for 14 weeks—two weeks longer than the EU’s trade agreement consultations—and collectively attracted more than 600,000 responses, making it one of the largest consultation exercises ever run by the UK Government.

Alongside the consultations, we ran 12 events across the different regions and nations of the UK to seek their views on how prospective trade agreements could support prosperity and growth. The evidence provided in the responses to those consultations will inform the Government’s overall approach to our future trading relationship with these countries, including our approach to negotiating any trade agreements. Decisions made as a result of the consultations will be published before potential negotiations start.

This is the first time that the United Kingdom has consulted on potential future trade agreements independently. The volume of responses across all four consultations, run simultaneously, means that it is only right that we take time to consider the responses and the views of this House in detail. While there are many other markets that the UK will look to for new agreements, our shared values and our strength of trade with the US, Australia and New Zealand make them the right places on which to focus our initial attention, alongside our interest in potentially negotiating accession to the CPTPP.

Let me turn to future scrutiny of our free trade agreements—a topic that has received much discussion in both Houses, including through the inquiry co-ordinated by the International Trade Committee and the published response.