Emily Carver: Covid has exposed the flaws in our education system. It’s time for a radical rethink.

24 Feb

Emily Carver is Head of Media at the Institute of Economic Affairs.

Over the course of this pandemic, J S Mill’s “harm principle” has been used to rationalise the decision to lockdown. At first glance this appears reasonable, however, it rests on the assumption that the harm caused by the virus exceeds that of lockdown. It will be many months before we fully comprehend the impact of the restrictions, but the former assumption may be flawed when applied to education.

The Prime Minister has now confirmed that schools will reopen in March, which will no doubt come as a relief to parents up and down this country. But the temporary school closures, and the disruption of nearly a whole year of education, have severely affected children’s well-being and educational progress – the impact of which will be felt for many years.

The toll on mental health is already recognised. In a survey of over 10,000 parents, over half said they had seen a negative change in the mental health of their children since lockdown. The rates of probable mental disorders among children have risen considerably, increasing from one in nine in 2017 to one in six in July 2020. Anecdotally, parents are reporting a rise in disordered eating, anxiety and loneliness.

Far from being a leveller, the pandemic has, inevitably, impacted disproportionately the education of the already disadvantaged. During the first lockdown, primary age children from the richest third of families received four and a half more hours of learning time compared to those from the poorest third of families. This has compounded pre-existing inequities and is nothing short of a scandal.

Months on, children from middle-class households are still, on average, spending considerably more time learning than those from working-class households. Regional inequalities are also stark, with children in London and the South East spending more time on schoolwork, both online and offline, than those in other parts of the country.

The Government plans to give schools a cash boost to fund “catch up” classes during the summer holidays, and to pay staff to work additional hours to support children who have fallen behind. Such interventions are welcome and should hopefully go some way to mitigating the impact of the last year on pupils’ progress.

However, this will be little more than a sticking plaster unless the Government addresses the broader, more structural problems in our schooling system. It is no secret that our education system is failing many children in this country; you only have to look to the international league tables to see that the UK is underperforming compared to Asian countries, as well as a number of European nations. This should be a national embarrassment.

While it is certainly true that our elite schools, in both the independent and state sector, are some of the highest performing in the world, too many are lagging behind. If the Government is as serious about education as it claims to be, there needs to be a renewed effort to address the system’s failings. It is simply disgraceful that somewhere between 15 and 20 per cent of our young people may be “functionally illiterate” when they leave school!

So, where do we go from here? A new paper by the Institute of Economic Affairs argues this could be the time for a radical rethink of our education system.

To begin with, why do we insist children start school by age five? This is earlier than in most other developed countries and actually dates back to a time when the majority of children left school at ten. Considering that teachers have reported that significant numbers of children are quite simply unprepared to start school at this age (another scandal), it may well be the case that children would be better off entering school a little later, when they are more ready to benefit from formal education. Of course, this will have an impact on pre-schooling arrangements which, at present, greatly advantage the better off. It also seems inexplicable that we have children entering reception classes with almost a year between the oldest and youngest in the class, which has been proven to disadvantage summer babies.

Longer school days have been mooted by politicians over the years, including by the former Education Secretary Michael Gove, but little has changed. If additional classes help those falling behind now due to the pandemic, why not be bold, and extend this into the future? Not only would this allow more scope for extra-curricular activities – something that has been sorely missed during the past year – but the extra hours would allow for homework to be replaced by supervised class work – a welcome move for those pupils who struggle to work from home and a way to improve the educational outcomes of the less advantaged.

However, such policies could prove difficult to implement. The teaching unions have been very resistant to government policy over the course of the pandemic and could present a rather stubborn obstacle in the way of any radical reform of the school year. In order to pursue any meaningful change, the Government would need to amend the national contract, which is tied to the traditional school year, and which the unions may perceive as an existential assault on their influence. Of course, the majority of teachers are not as intransigent as their union representatives and may be more flexible in their attitude towards change, if well-argued.

Successful academies, independent schools and free schools have provided useful models for a way ahead. Free from the restrictions of the national contract, such schools have been able to innovate with their education provision, experiment with the length of the school day and diversify their curricula. It is interesting that many of these institutions serve less-advantaged children and are led by headteachers who advocate “traditional” methods of knowledge-based learning, discipline and pride in the institution itself. Further academisation may provide the flexibility we need to boost standards significantly.

And why not offer parents more choice? The Government currently pays schools a “pupil premium” to support disadvantaged pupils. This amounts to £1,345 for every primary age pupil and £955 for those in secondary school. However, parents have no say in how this is spent. We know how much private tuition can benefit children’s learning, so why not place more power in the hands of less well-off parents and redirect this money in the form of vouchers, which could then be used to hire tutors or for other educational purposes?

It would be naïve to suggest that there are quick fixes to the myriad of challenges facing any secretary of state for education. However, it is clear that this pandemic has shown up fundamental fault lines in the provision of schooling in this country. If the Government is really serious about levelling-up, there has to be a reconsideration of the way in which we provide education; it is neither moral nor sensible to congratulate ourselves on our elite schools and universities when so many children leave school ill-equipped to enter adult life. It is in the interests of everyone to have a well-educated, workforce at the heart of a successful, vibrant economy.

Daniel Hannan: Ignore the Europhile sneers. Joining the Pacific bloc marks the rebirth of Global Britain.

3 Feb

Daniel Hannan is a writer and columnist. He was a Conservative MEP from 1999 to 2020, and is now President of the Initiative for Free Trade.

She’s unstoppable, that Liz Truss. The epidemic has put most Whitehall ministries in damage limitation mode, but the Department of International Trade is on a roll, signing 62 free trade agreements to date – plus, obviously, the deal with the EU itself.

Those who can’t bear the thought of Brexit succeeding are, naturally, scoffing. These deals, they say, are largely replicas of what we already had as EU members. Their new line of criticism is, I suppose, an improvement on the position that they took until 12 months ago, namely that we would barely be able to strike any deals at all.

But it’s still not true. Many of the “rollover” treaties go further in small ways: more generous quotas, fewer restrictions. True, these liberalisations are chiefly tokens of intent. But that intent is real. With limited capacity, our priority has been to negotiate new FTAs – that is FTAs with countries where the EU currently has no trade deals, such as Australia and the United States.

Where there are serviceable existing arrangements, we have tended to say, in effect: “Let’s leave things roughly as they are for now, and agree to come back to it next year”. Even in these cases, though, we have often taken the opportunity to go further. The UK-Japan deal, for example, is more comprehensive when it comes to services and cross-border data flows than the EU-Japan deal, even though the latter had only just entered into effect.

This week, Britain took a momentous step when it applied to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), a free trade zone comprising Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam.

Again, many Europhiles are sneering. Joining a Pacific trade pact, they say, defies geography. And it is of course true that Britain is not a Pacific country (other than in the technical sense of owning the Pitcairn islands). But we have exceptionally close links to a number of CPTPP members. Australia, New Zealand, Singapore and Canada are common law, English-speaking nations. So, to a degree, are Brunei and Malaysia.

One of the arguments for Brexit was that, in the internet age, cultural proximity trumps physical proximity. That argument is stronger now than it was a year ago. The lockdown has habituated us to using Zoom or Teams for important discussions. When travel returns, it is hard to imagine that business people will be as ready to hop over to Düsseldorf for the day to make a presentation. If you’re online, Rotorua is no further than Rennes – indeed, nearer in the sense that it shares your language, legal system and accounting methods.

Another argument for Brexit was that, by global standards, the EU was a slow-growth region. That argument, too, is now looking stronger. Although we talk of the pandemic as a global event, the truth is that it hit Europe much harder than Asia, Africa or the Antipodes.

But the biggest difference between the EU and the CPTPP is that the latter is a trade agreement rather than a state-in-the-making. Its members simply seek to maximise their prosperity through greater specialisation and exchange. Joining the CPTPP does not involve making budget transfers to its poorer regions, or accepting the supremacy of its laws over our parliamentary statutes, or adopting a common flag, passport or anthem. Nor does it require a member to alter its standards on non-exported goods and services.

Viewed purely as a trade pact, the CPTPP is preferable to the EU because it elevates mutual recognition over harmonisation. The essence of the CPTPP is that its members agree to refrain from certain actions that would restrict free commerce. It is perfectly possible for CPTPP members simultaneously to have ambitious trade deals with each other and with the EU – as, for example, Japan and Canada do. On services and on professional qualifications, CPTPP uses a “negative list” approach. In other words, it assumes that whatever is legal in one state is legal in all the others unless it is expressly exempted in the treaty.

It is fair to say that the CPTPP is wide rather than deep. It does not go as far as, say, the Australia–New Zealand deal, which is arguably the most advanced on the planet. But, as Australia and New Zealand demonstrate, a deeper trade deal can nestle within a broader one.

Our aim should be to negotiate a deal similar to that which Australia and New Zealand enjoy with one another – assuming that is, that our protectionists in DEFRA and the NFU will let us. We should, in other words, seek both to participate fully in the CPTPP and, under its auspices, to secure even more ambitious agreements with the countries closest to us in terms of GDP per capita and regulatory interoperability – namely, Australia, Canada, New Zealand and Singapore.

Indeed, New Zealand, Singapore and Chile – three of the world’s greatest free-traders – are currently setting the pace when it comes to digital trade. If Britain peels itself away from the wary and watchful EU, which has never been comfortable with the free-wheeling nature of the internet, and joins these Hayekian states, it is likely to end up crafting standards on digital trade that every competitive country will want to adopt.

Finally, there is a geopolitical case for membership. Donald Trump’s decision to pull out of the Pacific deal at the last minute opened the door to China which, three months ago, created a rival trade pact with Australia, Japan, New Zealand, South Korea, and all ten members of ASEAN.

My guess is that the Biden administration will want to reverse Trump’s mistake. After all, many of its leading members had been involved with putting the Trans-Pacific Partnership together in the first place under Obama. British membership of the zone, as well as being in itself a useful counterweight to Beijing’s ambitions in the region, will set the context for UK-US trade talks.

To sum up, then, our CPTPP application will boost jobs and growth, strengthen the Anglosphere, improve the prospects for a bilateral American deal, accelerate our pivot to the fastest-growing markets on Earth, and elevate Global Britain. Not bad. Not bad at all.

Nick King: London is unlikely to have another “Big Bang” moment – but here’s how we can boost its potential post-Brexit

15 Jan

Nick King is a Research Fellow at the Centre for Policy Studies

When Rishi Sunak was recently asked whether the UKs departure from the European Union meant we should revisit the Big Bang Playbook for the City of London, what choice was there but to agree? After all, what self-respecting neo-Thatcherite Chancellor of the Exchequer could say anything else when such an enticing proposition is dangled in front of them by a newspaper editor (in this case, Andy Silvester, of CityAM)?

But the world were living in is not that of the mid-80s. The EU, for all its faults, does not have the equivalent of the Restrictive Practices Act which Nigel Lawson – another political hero of the Chancellors – worked so hard to overturn. The idea of another Big Bang moment, the kind of sudden, overnight liberation which occurred on October 27, 1986, is unlikely to materialise.

But that doesn’t mean that there isn’t huge scope to use Brexit to boost the City, and the British economy – especially if we learn the right lessons from those Thatcher-era reforms.

As well as sweeping away anachronistic, inefficient practices, the Big Bang served to introduce three vital new operating principles to the City of London, turning it from a relatively sleepy, parochial industry into a global powerhouse. Those principles remain as valid today as they were in the 1980s.

The first was to open the City up to the world. For generations, the institutions of the City had been highly clubbable places, populated mainly by members of the British establishment. The Big Bang introduced competition – and global competition at that – which led to drastic changes in attitude and performance. In time, that led to London becoming one of the important financial hubs in the world alongside New York, in either first or second place for insurance, investment banking, asset management, FX trading and more.

Some worry that leaving the EU risks this preeminence. Certainly, ever since the Brexit vote, it has been clear that Paris, Amsterdam and Frankfurt (among others) have had more than one eye on the opportunity to knock London off its perch. Fortunately, for all the reports of 100,000+ jobs going, the impacts thus far have been limited. As one industry player put it to me, not even the Germans want to go to Frankfurt.

But the ability to access, and deploy, capital across the continent is clearly vital, and jeopardised by the fact we have left the European Single Market without a deal on services. It certainly does not make sense for the City to be regulated by Europe: given the relative size of our financial services industries, that would be the tail wagging the dog. But the Chancellor and the Treasury need to negotiate a Memorandum of Understanding that allows us to continue to operate in, and cooperate with, the EU as soon as possible.

Yet we must also turn that challenge into an opportunity – to not just maintain but enhance the UKs status as a global centre for capital and financial services.

Our equity markets are already some of the deepest in the world. But we need to remain world-class and be able to finance the industries of tomorrow. The Listings Review, being undertaken by Lord Hill, is fully focused on achieving precisely that by making the regime more competitive.

Already it is estimated that the UK investment management industry manages some £10 trillion of assets. But again, we need to work harder to attract more capital from South America, the Middle East and South East Asia.

Attracting more capital – and talent – while continuing to build our reputation as a global centre for financial services should a central pillar of the Global Britain agenda.

The second principle from the Big Bang is proportionate regulation. Just as those reforms were predicated on, and driven by, regulation that works, we now need to make sure that our regulatory regime is one which supports rather than stifles our financial services industry – and which is tailored to our needs.

Coming out of the Single Market there are few voices clamouring for a bonfire of regulations in financial services. But at the same time, there is no point in sticking rigidly to a set of rules which dont necessarily work for us or our markets. Other authors on this site have, rightly, pointed to changes which should be made around the Alternative Investment Fund Managers Directive and the Markets in Financial Instruments Directive II. The collapse of the financial advice industry, in particular, has been entirely been driven by overzealous, anti-competitive regulation.

Another set of regulations we should put in the crosshairs are the Basel capital requirements, which can treat a small bank or a building society in the same way as a large investment bank – which also damages competition by making it much harder for the new challenger banks to compete. By taking a more proportionate approach, and freeing up domestic lenders’ capital, UK regulators can create a more competitive market and immediately unlock more funding for domestic priorities like sustainability, net zero and levelling up. It is also striking that Britain’s regulators rarely have a duty to consider the growth impacts of their decisions: as George Osborne once said, we do not want the financial services industry to have the stability of the graveyard.

Proportionate regulation is linked to the third pillar that drove the Big Bang’s success: our absolute reliance on innovation. The reforms of the Thatcher era brought in new players, new instruments and new ways of doing things. That same willingness to embrace innovation is imperative if we are to thrive in the future.

Today, despite our world-leading fintech industry, much of the pioneering innovation in financial services happens in Singapore, Shanghai and other Asian markets. Industry insiders claim that an abundance of caution prevailsat the FCA. For all the successes of its innovation “sandbox” (a concept some claim was forced on it by Osborne), it is still not doing enough to support innovation or to open up new markets. These are issues I have written about before but those in the fintech industry tell me FCA authorisation still takes too long.

The tone for the regulators is set by the Treasury, of course – and the Treasury needs to back innovation now like never before. It must ensure its regulators lose the “gold plating” mentality of old, which has put us at a competitive disadvantage, and use the Future Regulatory Framework Review to help us capture the global opportunities which abound.

The fundamentals of our financial services industry remain strong, as the Chancellor himself said, but they cannot be taken for granted. Despite the fact we are blessed in our language, timezone, history and rule of law, the forces of competition are ever stronger – on the continent and beyond. To maintain London and the UKs preeminent status will take hard work and determination.

And that, I would argue, is the most important lesson of the Big Bang. The new entrants, innovation and subsequent global success came about because we had a government that was ready to back the industry as required. It was a Government that recognised that financial services, the profit motive and shareholder interest were fundamental goods – and spoke out on their behalf.

We might not be in line for another Big Bang but to help us make the most of Brexit we need the Government to be pro-business, pro-City and to offer financial services enduring political support. If those principles are in the Chancellors “Big Bank Playbook”, then sign me up.

Malcolm Rifkind: We need a global response to Beijing’s belligerence, inhumanity and mendacity

13 Jan

Sir Malcolm Rifkind was Foreign Secretary from 1995 until 1997 and was Minister of State in the Foreign Office from 1983-86. He was responsible for the final stage of negotiations with the Chinese Government over the return of Hong Kong to China.

A week today, assuming the constitutional democratic process takes its proper course, Joe Biden will be inaugurated as President of the United States.

Immediately, he will face two challenges.

The first is that he is not Donald Trump. He will want to distance himself from everything his predecessor represents: belligerence, intolerance, rage, incompetence, incoherence and unilateralism.

He will want to prove himself to be the multilateralist, internationalist, engagement-minded president – and democrat – that we all hope for.

In some ways, he will make us all heave a sigh of relief.

At the same time, he should reject one of the mistakes of the Obama administration in which he served. Against the tyrants of the world, what counts is strength. Rhetoric, while welcome, must be accompanied by action if it is to mean anything.

And now more than any time there’s a need to stand up to Xi Jinping’s brutal regime in China.

Tonight, a major new report will be launched by the Conservative Party Human Rights Commission, titled The Darkness Deepens.

More than any other report in recent time, it provides the full catalogue of horrors of what Xi Jinping’s regime is up to, against its own people and against the free world.

Other reports have detailed individually the atrocities against the Uyghurs, the abuses in Tibet, the persecution of Christians, the suppression of dissent and the silencing of liberties in Hong Kong – but few have combined them all. This report weaves this house of horrors together.

It brings together the dismantling of freedom in Hong Kong, the atrocities in Tibet, the assault on freedom of religion and expression throughout China and the persecution of the Uyghurs, in a way that has seldom been combined before.

And it offers ways forward.

Crucially, the report makes clear, it is not anti-China – it is critical of the Chinese Communist Party regime.

The starting point is engagement and dialogue. But the issue is not should we talk, but what should we talk about and how. And an unavoidable topic of conversation should be human rights.

And then the next question is should we trade? And for me the answer is: yes, but on what terms?

Not on terms of bullying and intimidation. Not on ”wolf-warrior diplomacy”. And definitely not by surrendering our values.

And so we need a global response to Beijing’s belligerence, inhumanity and mendacity.

The British barrister Geoffrey Nice, who prosecuted Slobodan Milošević, now chairs an inquiry into atrocities facing the Uyghurs, and previously led an independent tribunal that concluded that forced organ harvesting from prisoners of conscience in China continues, and constitutes a crime against humanity. In that tribunal’s final judgement, published early last year, the eminent panel of lawyers and experts advise that anyone interacting with the Chinese regime should do so in the knowledge that they are “interacting with a criminal state”. The free world must do more to counter that criminality.

That should mean, as the Conservative Party Human Rights Commission proposes, Britain leading the establishment of an international coalition of democracies to coordinate a global response to the human rights crisis in China, bringing together not only the United States, Canada, Australia, New Zealand and our European allies, but countries such as Japan, South Korea, Taiwan and others in Asia and beyond.

The British government should do more to help build support for the establishment of a United Nations mechanism to monitor human rights in China, as called for last summer by at least 50 serving UN independent experts and several former UN special rapporteurs, including Zeid Raad al-Hussain, the distinguished former UN High Commissioner for Human Rights.

It is time to look at imposing targeted Magnitsky sanctions against key officials in the Chinese and Hong Kong regimes for serious human rights violations and breaches of international treaties.

We should be looking to diversify supply chains and reduce strategic dependence on China, and put our values and national security first when looking at Chinese investment in critical infrastructure and other sectors.

And while growing claims of genocide against the Uyghurs are not proven, there can be little doubt that what the Chinese regime is doing to the people in Xinjiang reaches the level of mass atrocities and can be considered to be attempted cultural genocide.

Last month an ingenious amendment to the Trade Bill that would prohibit trade deals with states found guilty of genocide was passed in the House of Lords by a majority of 287 to 181. What is striking is that it was introduced and supported by a cross-party group of peers that include Michael Forsyth, the former Conservative Cabinet minister, Lord Blencathra, former Conservative Chief Whip, Eric Pickles, former Conservative Party Chairman, along with Helena Kennedy, Labour peer and leading human rights barrister, Lord Alton, cross-bencher and former Liberal chief whip, the Labour and Liberal Democrat peers, bishops and numerous others across the House of Lords including David Hope, the former Supreme Court Justice. This is no collection of rebels, but some of the country’s most distinguished experts in their field, and therefore should be taken seriously.

The Government’s position has always been that it is for the courts, not politicians, to determine genocide, and I agree. But the problem is that our international judicial mechanisms for genocide determination are found wanting, due to the referral requirements and veto power of some countries, and the result all too often is government inaction in the face of mass atrocities. This amendment creates a vehicle, allowing for the High Court of England and Wales to make a determination and, in any given situation that it does so, the government is duty-bound to abandon any trade deals it may have or hope for with the regimes responsible. As Nice says, “no well-ordered state would want to be trading with a genocidal state.”

It is worth noting that this amendment does not apply retrospectively, and it does not violate multilateral trade commitments, only bilateral agreements. It doesn’t preclude further action at an international level – indeed it strengthens the case for it. And – given my own concern that the charge of genocide should only ever be made when there is indisputable evidence of mass killing and proof of intent – it would, according to Nice, “discourage, and probably significantly reduce, casual and often instrumental assertions that genocide is being committed.”

So it may or may not apply to China. But it would signal Britain’s intent – to the Chinese regime and every other brutal dictatorship – that we will not stand by while grave atrocities are committed. For these reasons I hope Members of Parliament will support it when it comes to the House of Commons.

The Conservative Party Human Rights Commission’s report on Xi Jinping’s human rights record follows its previous one in 2016, titled The Darkest Moment. As the Commission acknowledges, the title four and a half years ago was with hindsight a little premature, for the darkness has clearly deepened – hence the title of the new report. It makes sad reading, but it should be read in every foreign ministry in the world. If only the Chinese people could themselves read it too, for then they would realise the degree to which millions of their fellow citizens are persecuted and imprisoned by a cruel regime. That cruelty requires a robust, co-ordinated and effective response by the free world, and I hope Britain – together with the new US administration and our other allies, will lead that effort.

Michelle Donelan: The Government’s new Turing scheme will open up the world to British students

28 Dec

Michelle Donelan is Minister of State for Universities.

When things become too familiar, it can be comfortable to sit back and enjoy their benefits, never stopping to consider whether the old, established parameters still meet the needs of the present day. The thought of losing it becomes a wrench. Even if what is being offered in exchange is clearly better, the original has acquired a totemic nature that goes far beyond its present value.

Such can be the only explanation for the cries of dismay from some quarters that greeted the news last week that the UK government would be establishing a new global Turing scheme for students, following our decision not to continue participation in the EU’s Erasmus+ scheme.

I can understand why some people feel this way. Many prominent commentators, newsreaders or academics may have used Erasmus, or perhaps their children or friends did. It is easier to imagine what you know, than to visualise the benefits of what is being brought in. However, the simple reality is this: if anyone was creating a student exchange scheme for Britain today, would they really settle for Erasmus+?

Why would we wish to limit an exchange programme to the EU, when the fastest growing, most vibrant and dynamic countries are increasingly found in Asia and Africa – not to mention our old allies in North America, Australia and New Zealand? Some forward-thinking universities have already established exchange programmes, and even campuses, outside of Europe, and I commend them for that, but they deserve our full and whole-hearted support, not exclusion from the Government’s principal funded scheme.

It is also the case, unfortunately, that Erasmus’s benefits went overwhelmingly to students who were already advantaged. The language barrier meant that it was very hard for students not already studying a modern foreign language to take part, to flourish at their chosen university and get the most out of the academic experience. A 2006 study found that of those taking part in Erasmus from the UK, 51 per cent were from families with a high or very high income.

In 2014-15, those with parents in managerial or professional occupations from the UK were taking part in Erasmus at a rate 50 per cent higher than those whose parents had working class jobs – and the gap was widening. Of course, no-one would wish to prevent such students from studying abroad; but where Government support is concerned, surely it should be about ensuring all students have a fair and equal shot at studying abroad or going on an exchange.

That’s why the Government’s new Turing scheme will explicitly target students from disadvantaged backgrounds and areas which did not previously have many students benefiting from Erasmus+, making life-changing opportunities accessible to everyone across the country. It will be backed by over £100 million, providing funding for around 35,000 students in universities, colleges, on apprenticeships, and in schools to go on placements and exchanges overseas, starting in September 2021.

The programme will provide similar opportunities for students to study and work abroad as the Erasmus+ programme but it will include countries across the world and will deliver greater value for money to taxpayers. And it will be named after one of our greatest British scientists: Alan Turing, a pioneer of computing and cryptography, a hero of the Second World War and who himself studied abroad as a Visiting Fellow at Princeton.

Of course, none of this is to decry Erasmus+: undoubtedly, those who took part in the scheme benefited from it. However, the fact is that it is simply too limiting for the global Britain that we aspire to. Of the hundred best universities in the world in the QS World Rankings, only twelve are in the EU. If we have stayed with Erasmus+ it would have cost several hundreds of millions of pounds to fund a similar number of exchanges, not have been global in nature and continued to deliver poor participation rates for young people from deprived backgrounds.

In the future, we will see young people from Bolsover and Bishop Auckland studying in the Ivy League; entrepreneurs from Dudley and Derbyshire learning from the dynamic economies of Malaysia, Vietnam and Indonesia; and our best budding engineers from Hastings and Hartlepool inspired by world-leaders at MIT or the Indian Institute of Technology. The Turing scheme exemplifies the spirit of Brexit, opening up our opportunities, our hearts and our horizons to the whole world.

Imran Ahmad Khan: Now is the right time for the UK to evolve a sharper and tighter foreign policy

22 Dec

Imran Ahmad Khan is Member of Parliament for Wakefield and Chair of the All-Party Parliamentary Group for Foreign Affairs.

The UK has seldom faced such an array of challenges. The Covid-19 pandemic continues to wreak damage to our lives and businesses. Brexit negotiations have uncovered numerous flaws in our institutions, our negotiating skills, and our knowledge of our closest neighbours. The Presidential elections in the US have re-sparked divisive domestic issues. A rising China and a revanchist Russia, both of whom seek to expand their sphere of influence, now present an alternative, illiberal, world order.

Despite these threats, the UK’s recent foreign policy has been marked by missed opportunities and withdrawal. The UK’s weak presence at Davos and the Munich Security Conference in 2020 sent a signal of disinterest. Foreign leaders from countries in Asia, South America and Africa have lamented British disengagement from issues. European leaders have also debated strategic autonomy in Berlin and Paris, while London has remained silent.

Britain has a chance to reverse this deficit. Brexit presents us with the opportunity to deploy new tools of statecraft in pursuit of foreign policy objectives. The recent surge in defence spending – £16.5 billion over four years – will rebuild our pared back military capability. Upcoming commitments in the Sahel and the Indo-Pacific point to new arenas for British influence. Bilateral relationships, although attenuated in some cases, remain strong, and cooperation with the Commonwealth on issues of importance is close.

Now more than ever, a coherent, holistic strategy is required that will unite and enhance our capabilities to advance Britain’s position in the world, her interests, and her values.

What does Britain want?

Her Majesty’s Government’s principle role is to ensure the security and prosperity of her citizens. The British people not only expect this, but recognise the UK’s moral duty to prevent atrocities against oppressed and persecuted peoples, and promote stability across the globe.

These objectives are only achieved through the construction and defence of a world in which Britain is a leading and respected authority. This position does not have to stem from seizing the trident of global power or ruling as a hegemonic power.

Rather, Britain can achieve this through working within a group of like-minded nations that understand our values which set the parameters of the world order. Where there is a hegemon, we ought to influence them. When Britain wants to ensure freedom of navigation in the Bab el-Mandeb, or a free trade agreement with Japan, it helps to be listened to, and for our advise to be carefully weighed upon by military and diplomatic powers.

A critical part of this strategy has relied on maintaining good relations with the US. For decades, we have striven, buoyed by cultural similarity and shared history. The character and extent of American power is changing rapidly and significantly. Our strategy must consider this.

Why must it be Britain?

The defence, maintenance and championing of British security and prosperity internationally is critical. Yet as the current international order comes under strain, questions are raised as to whether Britain should pour its efforts out upon the world stage, and indeed why.

There is a very simple answer – no one else will. The US faces domestic challenges. The special relationship with Washington has weathered worse, but President-elect Biden will likely be distracted with ensuring an economic and institutional recovery. The European Union presents itself as a putative world power, but significant challenges and internal divisions demonstrate some of its many flaws.

Regardless, authoritarianism and illiberalism does not go unopposed. France, in collaboration with Sahelian nations and the UN, leads the charge against terrorism in North Africa. Japan provides development funding across Asia. Australia has stood up to Chinese influence, and has matched their rhetoric with a major increase in defence expenditure.

These actions are predominantly motivated by national interests. It is clear that no one will defend and champion our national interests on our behalf. We must do so ourselves.

What should be done?

Britain cannot enforce the rules of the international order alone. Through acting as a contributing nation for multilateral groups with different geographical and operational remits, Britain can maximise its influence and capacity to achieve geopolitical objectives.

There are circumstances in which Britain would act as the leading authority. The Joint Expeditionary Force that brings together eight northern European nations under British leadership is an excellent example. In other cases, Britain would play the role as a principal lieutenant, supporting and enabling a partner nation to achieve a common objective. Appreciate how British mine countermeasure vessels supported US efforts in the Strait of Hormuz and Bab El Mandeb.

Simply being a member of many organisations would improve British influence, providing us a greater understanding how other nations deploy their capabilities.

Our strength has always been as a convening power; we ought to accentuate it.

Using our leadership in the Joint Expeditionary Force to help France recruit more troops for Task Force Takuba, a pan-European special operations unit in the Sahel, would be one example. In turn, Paris may well help us convince Germany to take a stronger position against Iran, winning us plaudits in Washington.

Relationships like these are the very foundation of diplomacy and international strategy. As we forge our new path outside of the European Union, it is crucial that we fully understand and utilise this concept in order for Britain to position itself as the foremost, flexible, international power.

Our value should come not only from our military or economic strength, nor chiefly from our historic competencies, but rather because the UK has a unique capacity to act as a hub for dozens of overlapping webs of commitment, alliances and amity.

Such a policy would generate increased international political capital and create greater manoeuvring space for British diplomacy. Such space, and such capital, is sorely needed if we are to protect and promote our interests in an increasingly unstable century.

As Prime Minister Boris Johnson said, “the international situation is now more perilous and intensely competitive than at any time since the Cold War.” Britain, for all its often reflexive pessimism, has many valuable assets it can use, and important interests it must protect. Now is the right time to evolve a sharper and tighter foreign policy, based on a cool appraisal of the international partnerships and associations which really count. A new strategy which reshapes old alliances, forges new connections, takes advantage of Brexit, and which focuses on key priorities.

Stephen Booth: To reach a best in class trade deal with New Zealand and Australia, we must liberalise on agriculture

1 Oct

Stephen Booth is Head of the Britain in the World Project at Policy Exchange.

While the Brexit negotiations with the European Union have grabbed the headlines, the Department for International Trade has been quietly working away at the UK’s trading relationships with non-EU countries. Much of the work to date has been relatively uncontentious and therefore largely passes under the political radar.

In part, this is because the trade deals concluded to date have focused on securing and maintaining existing market access provided for by EU trade agreements, the UK’s access to which falls away at the end of the Brexit transition period on January 1. For example, the recent successful conclusion of UK trade negotiations with Japan built upon an existing EU-Japan agreement. While the UK and Japan were able to go further in some important areas, such as digital services and visas for business travel, the EU-Japan deal provided the template for much of the agreement on goods and tariffs.

However, the UK is also prioritising its negotiations with the United States, Australia and New Zealand. A trade agreement with the US presents the bigger immediate economic prize, but the negotiations with Australia and New Zealand are nonetheless strategically important. They are not only essential stepping stones towards the UK’s medium-term objective of joining the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP) – a trade bloc of 11 countries around the Pacific rim and the third largest in the world. They are also like-minded countries with which the UK can hope to influence others.

The negotiations with Australia and New Zealand should be simpler than those with the US but all three negotiations are truly novel, requiring the UK to break new ground. As a consequence, trade policy is likely to move up the political agenda as the Government seeks to manage the competing interests an independent UK trade policy inevitably needs to reconcile.

For example, last week, the House of Lords amended the Agriculture Bill to stipulate that any agricultural imports must “match or exceed” the UK’s own welfare and production standards. The amendment is supported by industry-led and celebrity-backed campaigns, urging MPs to “save our standards”, and the Bill is expected to return to the Commons later this month.

Of course, maintaining and promoting high standards is a legitimate aim and an important objective for UK policy. However, as we leave the EU’s regulatory system, we need to balance these objectives against the way the world outside the EU operates in practice. Not only might trade partners accuse the UK of using standards as a cloak for protectionism. As the National Food Strategy’s recent report argued, we cannot realistically expect to unilaterally force our standards on others at the same time as we are seeking trade agreements with them.

The crux of the trade negotiations with both Australia and New Zealand is likely to be the extent to which the UK is prepared to liberalise on agriculture in return for a high-quality agreement on trade in services, data and investment. The UK should use these negotiations to push for the best in class FTA on these issues, going further than the commitments contained in the CPTPP because, ultimately, if the UK joins the CPTPP, it will have access to these benefits anyway. Australia and New Zealand are both supportive of the UK’s bid to join and, like the UK, view the bilateral negotiations as important staging posts.

60 per cent of UK exports to Australia are already in services sectors and this could be boosted further by reducing barriers to professional and business services, such as the mutual recognition of qualifications, opening up procurement markets and liberalising visa regimes for business people. Both Australia and New Zealand have requirements on inward investment that are higher than the UK’s and higher than the OECD average. The UK will be looking to reduce some of these requirements in order to ease firms’ ability to invest in those economies as a base for exports into the Asia-Pacific region.

In return, both countries expect the UK to offer greater market access for their agriculture exports. Both countries traditionally seek complete tariff elimination in their FTAs. This is unrealistic, given that the UK is largely maintaining the EU’s tariffs on agriculture products. Nevertheless, the UK will have to be prepared to offer tariff reductions.

The Japanese experience of negotiating with Australia and on its accession to the CPTPP could serve as a model. Japan, which had a highly protected agricultural sector, has undergone tariff liberalisation as part of those agreements, but in some of the most sensitive sectors tariffs have been maintained and reductions have been phased in over 10, 15 and even 20 years.

The issue of standards ought to be less contentious with these markets. The RSPCA notes that New Zealand’s farm standards “have been judged higher than the UK”. Nevertheless, it is worth noting that Australia and New Zealand take a different approach to the EU when it comes to standards. Both joined the US in its complaint against the EU’s ban on hormone-treated beef.

George Brandis, Australia’s High Commissioner to the UK, said recently that “the intellectual argument for free trade in some quarters of the British political establishment is an argument that still needs to be fought and won.” It is true that the UK has much to learn and much to gain from cooperating with both countries on trade policy.

Both have undertaken radical programmes of unilateral trade liberalisation (Australia from the 1970s and New Zealand from the 1980s). Both countries have also liberalised further via networks of trade agreements. Australia’s FTAs with Chile, China, Malaysia, Singapore, Thailand and the US provide for duty-free and quota-free access for all their goods into the Australian market.

As a result, both countries have successfully combined the diversification of their exports while delivering benefits to consumers by lowering tariffs on imports. Just as importantly, both countries have used the moral and political capital earned from unilateral reforms to place themselves at the forefront of global initiatives to promote free trade.

New Zealand is a founding member of the Digital Economy Partnership Agreement (DEPA), together with like-minded Chile and Singapore, which is at the cutting-edge of innovation in digital trade. It was with these countries that New Zealand initiated the process that ultimately led to the CPTPP. Meanwhile, Australia is the joint leader of the 23-party negotiations on the Trade in Services Agreement at the World Trade Organisation.

If the UK wishes to be at the forefront of the argument for global free trade, this is the sort of company it should be keeping.

Jason Reed: Taiwan, Britain and the UN. It’s time to rethink the One-China Policy.

25 Sep

Jason Reed is External Communications Officer at the British Conservation Alliance.

The World Health Organisation (WHO), which is an arm of the UN, has come under a great deal of scrutiny this year as a result of its disastrous leadership throughout the pandemic, the most troubling aspect of which is its close links with China.

When the Coronavirus first emerged, transparency of information in government was suddenly more pivotal than ever before. But little to no information sharing occurred between countries at that crucial time, thanks to the combination of the WHO being at Beijing’s behest and the Chinese Communist Party’s aversion to openness of any kind. The cost of that failure was tens of thousands of lives.

The CCP’s tentacles extend far beyond the WHO, of course. The Chinese government has spent the last several decades worming its way into every corner of the UN. Perhaps the most obvious manifestation of that is the UN’s persistent refusal to recognise Taiwan as anything other than Chinese territory.

Imperialism is alive and well in the twenty-first century. China, a modern colonial power, still claims sovereignty over Taiwan, despite the fact that Taiwan has been an independent country for over 70 years, and its government was democratically elected by its population of 24 million.

Taiwan’s exclusion from the UN has nothing to do with Taiwan itself. It’s not as if the UN considered Taiwan’s request to join and rejected it on merit. Even North Korea is a member, after all. The UN simply refuses to acknowledge Taiwan’s existence. It is so beholden to the will of the Chinese government that it does not dare contradict anything that comes out of Beijing. What is the point of an international peace project if it reliably does the bidding of a communist dictatorship?

If there was ever a time to put our foot down and begin to roll back China’s power on the world stage, it is now. “De-Sinoficiation” will define international relations in the coming decades. The Coronavirus coverup, along with flagrant assaults on democracy in Hong Kong and the appalling genocide of the Uyghur Muslims in Xinjiang, mean that the world has no choice but to begin to distance itself from the CCP.

This will be an almighty task. For at least forty years, our politics and our economies have gradually become more and more intimately connected with those of China. Disentangling ourselves from that relationship will be a lengthy and arduous process. Finally deciding to exclude Huawei from our 5G network was the first step on a very long road.

But it is a journey we must make. De-Sinoficiation is a necessary task. The entire western world has effectively turned a blind eye to China’s wrongdoing for far too long. The watershed moment has now passed – there is no going back. In order to preserve any semblance of a liberal, globalised world order, China must be knocked off its omnipotent pedestal and held accountable for its actions.

Taiwan’s right to exist as an independent nation seems a good place to start. The right and wrong of the issue is clear-cut and it has always been a touchy area for the CCP, whose greatest fear is its sweeping authority being undermined.

In the Economist’s democracy index, Taiwan ranks third in Asia and 31st in the world (higher than Italy and Belgium). Meanwhile, China languishes among the fifteen least democratic countries, making it more authoritarian than Cuba and Iran. While Taiwan was legalising same-sex marriage, making it the first country in Asia to do so, China was writing ‘Xi Jinping Thought’ into its constitution.

Taiwan stands ready and able to become a fully-fledged member of the international community. There ought to be no question about its validity as an independent country. You might even argue that the island nation, which calls itself the Republic of China, has a much stronger claim to be the Chinese government than Beijing.

On top of everything else, Taiwan is a trailblazing Covid success story. Its total death count from the pandemic to date is seven. The Taiwanese government is also going above and beyond any reasonable expectations in order to build friendships with other democracies around the world, including the UK.

Despite the western world unfairly shunning it in favour of China’s economic might, Taiwan continues to behave courteously towards its would-be allies. For instance, the Taiwanese government donated over a million face masks to the NHS at the height of the British coronavirus outbreak.

Since then, Taiwan has – politely – asked to join the UN and be recognised as an independent nation, calmly pointing out the enormous body of evidence and precedents in its favour. Those calls have gone unheard. Some bridge-building is going on – such as through UK Export Finance investing in a Taiwanese renewable energy project – but it will never go far enough while China is still in the picture.

The British left is beginning to stake its flag in Beijing apologia. Now is the time for Conservatives to demonstrate what post-Brexit Global Britain could look like by standing up for freedom on the world stage. The first step ought to be reconsidering the long-outdated One-China Policy, which would surely cause a ripple of similar actions across the west and – potentially – force the UN to reconsider its close relationship with China.

The Government has an opportunity to lead the world on de-Sinofication and create a valuable new ally for Britain in the process. Let’s not waste any more time.

David Skelton: Brexit can unleash a new era of reindustrialisation. But only if we are free from state aid laws.

17 Sep

David Skelton is the author of Little Platoons: How a revived One Nation can empower England’s forgotten towns and redraw the political map.

Brexit provides the UK with an opportunity to build a new, high-skill, high-productivity economy. A bold agenda of reindustrialisation can revive regional economies and see the levelling-up agenda made flesh. But we can only make the most of these opportunities if we aren’t unnecessarily restricted by the EU’s state aid laws. As a sovereign nation, we should be free to follow an industrial policy that is best for Britain. We mustn’t have the ability of the British state to support innovation to be hidebound by the EU’s strict state aid rules.

There were many reasons that we voted to leave the EU. The ability to set our own laws and have them made by people who were elected and could be held accountable was a crucial part of the decision to Leave. A clear message was delivered in the referendum from long forgotten “post-industrial” towns across the country that we needed to tackle regional inequality. The EU’s apparent insistence on maintaining state aid rules after Brexit would ride roughshod over the first and make tackling regional inequality much more difficult to achieve.

I’ve long taken the view that the restrictive state aid rules imposed by the EU were one of the major obstacles to us achieving a new economic settlement that benefits the whole of the UK. The pursuit of a level playing field for the EU meant that the parts of the country that I talked about in Little Platoons, which were heavily impacted by deindustrialisation, became stuck in an economic cycle of low innovation, low skilled, low wage work.

This was bad for post-industrial parts of the country, but also bad for the economy as a whole, with the UK’s low productivity problem being particularly pronounced in those parts of the country that had seen economic decline for decades. The recycling of UK taxpayers cash (a reminder that we were a net contributor to the EU budget for decades) through much trumpeted structural funding was no substitute for the fact that state aid rules bound our hands and prevented us from a more ambitious strategy to reverse decades of decline.

Now we have left the EU, it’s essential that the EU isn’t able to bind our hands again as we look to shift the economic paradigm to that of a high-skills, high-productivity, high-wage, tech-driven economy. Freedom from EU state aid rules represents an important opportunity for us to deliver that altered economic settlement and to pursue a bold strategy that focuses on a high-tech reindustrialisation of our economy. This should emphasise the importance of manufacturing (including green industry) in reframing our economy.

Crucially, manufacturing is generally higher skill, more productive and more export driven than other sectors. Whereas manufacturing accounts for less than eight per cent of the jobs in the UK, it accounts for around two thirds of our R & D investment – the kind of investment that is crucial to future growth and prosperity. This R & D emphasis also underlines the importance of manufacturing creating what Shih and Pisano have described as the “industrial commons” – skills and knowledge networks and clusters that drive innovation further.

An industrial strategy free from the constraints of state-aid policy means that we can support the businesses and sectors that are at the forefront of the new industrial revolution and also use the power of government to create innovation hubs in the regions, along with government-supported and business-backed centres of industrial excellence. A new industrial policy, free from state-aid restrictions, could aim to deliver high innovation industrial hubs in regions where the transformative power of a government accelerated industrial commons could have an enormously positive impact.

Any discussion about the positive impact of industrial policy and the importance of a state-aid regime that supports it is normally accompanied with the construction of straw-men or, more accurately, straw “lame-ducks” and the argument that any industrial policy will inevitably go down the route of Britain in the 1970s.

This is an ideological worldview that regards the bailing out of British Leyland as trumping any international experience in the decades since.  However, what that international experience has shown is that by far the biggest risk for the UK lies in us not pursuing an intelligent industrial strategy.

International experience shows that state aid and industrial strategy can not only help to turn around lagging regions but also place countries at the forefront of emerging technologies. And successful international experience illustrates that an ambitious industrial strategy shouldn’t be about “bucking the market”, but, instead working with the market and using market signals to maximise the impact of government investment.

In many parts of Asia, including Korea, Japan, Taiwan and Singapore, industrial strategy has used market feedback to develop a sectoral industrial strategy that has seen living standards and productivity surge. In all cases, the feedback mechanism of the market has allowed governments to identify sectors for future growth and provide government investment that has allowed these countries to be leaders in key sectors.

The mid-century United States, seen wrongly as a laissez-faire bastion, also provides an example of gains that can be made when business and government work together. The hero of that story is Vannevar Bush, who saw the importance of the government strongly investing in and incubating innovation and helping to transfer ideas from the initial invention to the marketplace.

His importance has been summed up recently in the excellent work of Safi Bahcall. Bush understood that innovation and invention is key to future growth and prosperity, but also that early innovation is fragile and risky. Without government support, such innovation might well perish, but government support, through the likes of the National Science Foundation and DARPA allowed innovation to be nurtured at a crucial stage and resulted in a stream of inventions that transformed the economy.

Such a model, in which government nurtures innovation at the most important stage and invests in those companies at the cutting edge of key emerging technologies could be transformational for the UK economy, which already has a world-leading research base but often lacks the ability (or often means due to distorted or inefficient funding models) to maximise the commercialisation of innovation.

Government is in a position to support innovation at the most fragile stage of the innovation process in a way that the market simply cannot. An effective industrial strategy could maximise the UK’s strengths and use the directional sway of government to promote long-term growth outside of the South East. Such an ambitious policy would not, however, be fully possible under the stricture of EU state aid rules.

Brexit represents a remarkable opportunity for an economic renaissance in the UK. We no longer have to have ambition or imagination restricted by the EU’s state aid rules.

This renaissance could place the UK at the vanguard of the most industries and technologies over the coming decades. It could also bring about a lasting and meaningful transformation of parts of the country that have long been characterised by economic decline. This requires a sensible and strategic role for government, based on an independent economic policy that isn’t limited by the narrowly restrictive nature of EU state aid limits.

Stephen Booth: Why Stilton matters to the Japanese trade deal – and how talks can bring the UK closer to the CPTPP.

20 Aug

Stephen Booth is Head of the Britain in the World Project at Policy Exchange.

Global trade is the result of billions of individual decisions taken by businesses and consumers, but trade negotiations and agreements are inherently political. They not only require politicians and policymakers to haggle, in painstaking detail, over tariffs, quotas, rules and regulations; trade deals are also tools of foreign policy and in an increasingly unsettled, competitive and multi-polar world they can signify alliances between nations or groups of nations. Outside the EU, the UK’s trade agreements must therefore simultaneously address narrow economic and wider geopolitical interests.

Last week, we learnt that the UK-Japan trade talks had hit a roadblock over UK demands for greater market access for exports of Stilton cheese. The talks still seem likely to conclude successfully but the episode illustrates how seemingly small issues can play a disproportionate role in trade negotiations.

This would be a significant agreement for the UK. Japan is the third largest economy in the world and an increasingly important strategic ally for the UK post-Brexit. A UK-Japan trade deal is also an important step towards the UK’s accession to the 11-member Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).

Total UK exports to Japan are already worth around £14 billion, just over half of which are in services, so increasing the market for UK blue cheese exports, which is currently worth around £100,000 in Japan, might appear a strange issue to potentially derail the talks. However, the UK’s demands on Stilton have not simply come out of the blue.

Growth in cheese exports is a recent UK success story, with the Department for International Trade (DIT) noting that the UK made it into the top ten cheese exporters worldwide in 2018, selling £665 million worth, almost half of which was cheddar. Growth in Asian markets in particular has been strong, with demand in China rising from £67,000 in 2013 to £6.5 million in 2018, so it is not unreasonable for the UK to seek greater opportunities for these products in Japan.

More significantly, the UK-Japan deal will replace the EU-Japan deal, which will cease to apply to the UK when the Brexit transition period ends on January 1, 2021. The goal, largely on the insistence of Japan, has been to seek a new agreement, rather than simply copy and paste the existing EU-Japan deal. Inevitably, however, with time tight, these talks have not departed significantly from the EU-Japan precedent with regard to trade in goods (services and data are likely to be the more innovative aspects of a UK-Japan deal).

“Automotive for agriculture” was a major feature of the EU-Japan negotiations and, in this case, Japan has been targeting an immediate removal of UK car tariffs, whereas the EU-Japan agreement only provides for phased reductions over several years. The UK has understandably countered that it cannot make the concession for nothing in return.

Under the EU-Japan deal, Japanese tariffs on hard cheeses such as cheddar would be phased out by 2033. But for blue cheeses, such as Stilton, there will only be duty-free access on an agreed quota. Reportedly, the UK has also targeted a faster reduction to Japanese tariffs on pork. If the UK is successful in increasing the quota or removing tariffs faster, it will have achieved concessions the EU did not, which would have obvious symbolic significance for Brexiteers.

We don’t yet know the full details of the eventual UK-Japan deal but the likely compromise is that neither side will get as much as they would like on cars or agriculture. Ultimately, this kind of tussle is part of the theatre of end-game trade negotiations, where both sides need to be seen by domestic audiences to be fighting hard over every inch. Indeed, given the importance of getting the agricultural lobby onboard in various UK trade negotiations to come, going into bat for British agriculture now is not a bad PR move for the Government.

Some commentators have questioned whether spending political capital on trade agreements is worth the candle since the estimated macroeconomic gains from them are relatively small. DIT estimates the increase to UK GDP from a Japan deal will be 0.07 per cent over the long run, while a deal with the United States would provide up to a 0.16 per cent boost.

Putting aside a valid debate about how accurately existing models capture all the facets of comprehensive modern trade agreements, these types of numbers are not unique to UK FTAs. The EU-Japan deal (the biggest ever completed by the EU) was estimated to boost EU GDP by 0.14 per cent, a figure regarded by independent researchers as “plausible, though at the high end of the range of past estimates”.

Ultimately, for advanced and open economies, trade agreements are rarely macroeconomically significant. They are opportunities to address microeconomic issues and require trade-offs to be made between them. These decisions can be hugely important for individual sectors, which is why they can be politically controversial.

Beyond any quantifiable economic benefits, closer economic and political cooperation via trade agreements presents an opportunity to build coalitions to help shape the course of regional or global developments. Successful conclusion of the Japan agreement and accession to the CPTPP will boost the economic and political relevance of the UK in the Indo-Pacific region, which is likely to host most of the world’s economic growth in the years ahead.

Similarly, Japan’s enthusiasm to reach a deal with the UK is not only about commerce. Foreign Minister Toshimitsu Motegi’s recent trip to London also provided a chance to discuss bilateral co-operation on security and defence, including the UK’s stronger stance towards China on issues such as Huawei and Hong Kong. A trade deal is another way to strengthen strategic bonds.

It is worth keeping this mind as another round of UK-EU talks – in this case to loosen ties – get underway this week. The Remain campaign had wanted the Brexit debate to be about trade above all else, but it was always primarily about politics. All trade agreements are political, but the level of economic and legal integration in the EU means it is as much, if not more, about politics than trade. Remain lost because it was unable, or unwilling, to make the intrinsic case for political union, or at least that it should be tolerated.

Indeed, the most significant macroeconomic consequences of Brexit – leaving the customs union and the single market – flow from the political desire to “take back control” of trade and regulatory policy. Continued dependence on Brussels in these fields without a vote in the EU’s political institutions was always likely to be untenable for the UK in the long-term.

Equally, sovereignty is never absolute. The more integration the UK seeks from trade agreements with the likes of the US and the CPTPP in the future, the more the UK will face difficult political trade-offs over its approaches to various issues from agricultural liberalisation to the regulation of data. Existing trade flows and geographical proximity to the EU will inevitably play some role in how the UK takes these decisions over the long-term.

However, it shouldn’t be a surprise that Brexit means treating the EU much more like any other trade partner. It’s the politics, stupid!