Post-Brexit trade with EU can be as strong as it ever was, says Fox
Trade Secretary wants Britain to be a fully paid-up member of the World Trade Organisation
BRITAIN can enjoy trade with the European Union that is at least as free as it is now despite Brexit, Liam Fox has claimed.
The International Trade Secretary yesterday heralded the “glorious opportunity” of leaving the EU as he said for the first time that he wants Britain to become a full independent member of the World Trade Organisation.
The move makes it increasingly likely that Britain will abandon membership of the Customs Union so it can conduct its own trade deals with countries around the world. Dr Fox also suggested that “modern-day critics of free trade” such as Labour leader Jeremy Corbyn, should learn from the “devastating failures of alternative economic models” like communism.
Japanese carmaker Nissan warned it could scrap new investment in its UK plant unless the Government compensates it for any post-Brexit tariffs.
It came as a new report found that Britain’s ruling classes were the only group who voted overwhelmingly to stay in the European Union.
The report from the Centre for Social Justice and Legatum Institute found that people in the “AB” ruling class – the middle and upper classes – were the only group with a majority voting to Remain at the June 23 referendum.
The majority of people in all the other income groups – describe as C1, C2, D and E – all voted to leave, the report said. While 57 per cent of voters in the more affluent AB group voted Remain, the proportion in the other four groups was 36 per cent.
Speaking in Manchester, Dr Fox said that Britain’s free trade after it leaves the European Union will be “at least as free” as it is now. He suggested that Eu- rope will suffer more than Britain if it chooses to erect trade barriers.
He said: “Through the WTO the UK has helped push through the trade facilitation agreement which, once implemented, could add over £70 billion to the global economy annually, of which £1 billion will come to the UK.
“As a newly independent WTO member outside the EU, we will continue to fight for trade liberalisation as well as potentially helping developing markets trade their way out of poverty by giving them preferential access to our markets.”
He said that “protectionism never helps anyone at all”, adding: “It is in everyone’s interests that we have at least as free a trading environment as we have today. Anything else may not harm institutions but it will harm the people of Europe and it is the people of Europe who should be at the forefront of our thoughts.” Dr Fox also defended his decision to warn that businesses are “too lazy and too fat”.
Of his previous experience as a doctor, he said: “My job was not to tell people what they wanted to hear. It was to tell people what they needed to hear to put things right. If that applies to being a doctor, why does it not apply to politics? A question I have always wondered.” He told business leaders: “Protectionism never actually helps anybody at all. We want it [trade with the EU] to be as free and as open as possible.”
Former Cabinet minister Oliver Letwin said yesterday the UK needed to retain access to the single market while gaining control over immigration. Asked if that amounted to having your cake and eating it, he told the BBC: “Yes – correct – that’s what we want - we want cake and eating it.”
‘Critics of free trade should learn from the failures of alternative economic models like communism’
Liam Fox, the International Trade Secretary, was quite right yesterday to speak of Britain’s post-Brexit trading potential. Leaving the EU, he argued, means we can not only forge new freetrade arrangements but also make the wider case for liberalisation. Given that the economy has not collapsed since the referendum, and that so many non-EU countries have shown interest in doing business with the UK, there is plenty of reason for optimism. Looking at the state of affairs across the Channel, it increasingly seems as if Britain dodged a bullet by voting to leave.
Take Germany. The country prides itself on prudence and stability, often lecturing southern Europeans on their profligacy. Yet financial markets are gripped with fear over Deutsche Bank and Commerzbank, pillars of the European banking system. Those fears reflect the awkward fact that Germany’s supposedly conservative banks have been big buyers of exotic and thus risky bonds. The markets also remember that in the last financial crisis, Germany’s ultra-respectable regional savings banks were revealed as reckless lenders and had to be bailed out by taxpayers.
In this context, the notion that Frankfurt might replace London as the centre of European banking seems incredible. And while Germany may be Europe’s biggest economy, its problems are not unusual: it is simply the latest eurozone country to be left fearing for its banks. That is telling, a reminder that the currency’s single interest rate for so many diverse economies fosters instability, not least by leaving a high-growth economy such as Germany awash with cheap money.
Will German banks need another bail-out? Will the eurozone survive in its current form? The EU clearly faces major structural challenges as well as that raised by Brexit. We could add the refugee crisis to the list – and the rise of nationalist parties proves that the desire for greater control over national borders is far from unique to Britain. By choosing to vote out, the UK increasingly looks farsighted rather than, as some bitter Remainers have complained, petulant.
The Tory conference begins on Sunday and it is a chance to spread Dr Fox’s message. Brexit, if pursued cleverly, can offer an example to the world of the advantages of free trade. For Britain, it may eventually mean a more competitive and outward looking economy. The future of the UK is global, not just European.