Parliamentary Scrutiny of Trade Deals: How does the UK Measure Up?
Guest blog by Emily Jones, Associate Professor in Public Policy and Director of the Global Economic Governance Programme and Anna Sands, Research Officer of the Global Economic Governance Programme both at the Blavatnik School of Government, University of Oxford.
30 September 2020
In the next few weeks Parliament will decide how much scrutiny it has over the UK’s future trade deals. The Trade Bill is currently in the House of Lords, and a series of amendments have been tabled that aim to strengthen Parliament’s role.
As things stand, Parliament’s role will be minimal. The negotiation and ratification of international trade agreements falls under the Royal Prerogative – the making of international treaties is one of the few actions that Ministers can take without the approval of Parliament. […]
Briefing Paper 48 – THE “BEARABLE LIGHTNESS” OF BREXIT ON THE ACP COUNTRIES’ TRADE: GLOBAL VALUE CHAINS AND RULES OF ORIGIN
This Briefing Paper considers how Brexit will impinge on the African, Caribbean and Pacific (ACP) countries currently governed by the Economic Partnership Agreements (EPAs) negotiated by the EU. The authors explore whether the new Brexit-induced frictions on UK-EU trade will reduce the demand for ACP inputs – such as Cocoa products – into the goods that the UK and EU trade with each other. They conclude that the economic effects of even a ‘No Deal’ Brexit on ACP countries’ trade will be tiny in aggregate, because ACP countries supply only small amounts of inputs into the products involved in UK-EU trade.
Read Briefing Paper 48: THE “BEARABLE LIGHTNESS” OF BREXIT ON THE ACP COUNTRIES’ TRADE: GLOBAL VALUE CHAINS AND RULES OF ORIGIN
Briefing Paper 47 – CAN THE UK GOVERNMENT BE ‘WORLD-LEADING’ IN BOTH TRADE AND CLIMATE POLICY?
The UK is the first major economy to commit to a net-zero emissions by 2050 climate target, and it also has ambitious trade policy goals of providing multilateral leadership and concluding major new trade agreements. This Briefing Paper examines the coherence of UK trade and climate goals in regards to whether the UK Government has set out a clear strategy for integrating trade and climate policy, is acting on areas of mutual supportiveness, and is addressing areas of potential conflict. The authors find room for improvement in relation to all three areas. They identify a lack of cross-cutting strategy in UK climate legislation and in its approach to free trade agreements, and suggest the UK reforms its approach to fossil fuel subsidies and builds on its efforts in regard to environmental goods. Finally, the authors underscore the need for ambition and transparency for green subsidies and carbon pricing.
Read Briefing Paper 47: CAN THE UK GOVERNMENT BE ‘WORLD-LEADING’ IN BOTH TRADE AND CLIMATE POLICY
Tariff inversion in UK Freeports offers little opportunity for duty savings
28 July 2020
Peter Holmes is a Reader in Economics at the University of Sussex and Julia Magntorn Garrett is a Research Officer in Economics at the University of Sussex. Both are Fellows of the UK Trade Policy Observatory.
The Department for International Trade (DIT) Freeports consultation document states duty inversion as one of the four core benefits of a Freeport: “If the duty on a finished product is lower than that on the component parts, a company could benefit by importing components duty free, manufacture the final product in the Freeport, and then pay the duty at the rate of the finished product when it enters the UK’s domestic market.” […]
The case for more flexibility in post-Brexit immigration rules
14 July 2020
Alasdair Smith is an Emeritus Professor of Economics at the University of Sussex and is a member of the UK Trade Policy Observatory.
There were no surprises in yesterday’s government announcement of the post-Brexit ‘points-based’ immigration rules (except for those who thought that a provision for health and care might actually cover social care workers).
The government’s stated objectives are “flexibility and control over our borders”. However, an essential feature of the points-based scheme is that it is not actually operated at the border, but in the jobs market through the rules that non-UK employees must satisfy in order to take up a job offer in the UK. EU citizens will continue to have visa-free entry to the UK: the change for them is in their right to take up employment in the UK. (In all of this, Irish citizens are treated the same as UK citizens, and indeed EU citizens in Ireland can enter the UK without passport checks.) […]
Briefing Paper 46 – THE JAPAN-UK FREE TRADE AGREEMENT – CONTINUITY OR NO CONTINUITY? HOW CAN IT STILL BE AMBITIOUS?
This Briefing Paper examines the underlying issues related to the Japan-UK Free Trade Agreement negotiation. The author argues that there are two significant challenges underlying the Japan-UK FTA negotiation: the EU-UK FTA and the timeframe. The paper then discusses what should be prioritised to make the Japan-UK FTA ambitious, taking into account the unprecedented short negotiating timeframe, and proposes a possible mechanism to cope with unfinished business in order to make the agreement truly valuable in the long-term.
Read Briefing Paper 46: THE JAPAN-UK FREE TRADE AGREEMENT – CONTINUITY OR NO CONTINUITY? HOW CAN IT STILL BE AMBITIOUS?
The Japan-UK FTA: Three fundamental issues to consider when assessing its value
8 July 2020
Dr Minako Morita-Jaeger, International Trade Policy Consultant and Fellow, UK Trade Policy Observatory at the University of Sussex.
Japan and the UK launched the Japan-UK Free Trade Agreement (FTA) negotiation on 9th June. The two governments agreed to “work quickly to make the new partnership as ambitious, high standard, and mutually beneficial as the EU-Japan Economic Partnership Agreement”.[1] As negotiations accelerate, there are three fundamental issues to consider when assessing the deal. […]
Briefing Paper 45 – WE’RE GOING TO MAKE THEM AN OFFER THEY CAN REFUSE: RULES OF ORIGIN AND THE UK-EU FREE TRADE AGREEMENT
The UK’s negotiation of a Free Trade Agreement with the EU will necessarily involve defining rules of origin, and before long negotiations with countries such as the US, Japan, and Australia will face the same task. In this Briefing Paper, the authors outline what rules of origin are, why they are needed, why they are complex, and which sectors in the UK may be most vulnerable to more restrictive rules of origin. They also discuss why the EU is highly unlikely to agree to the UK’s proposal on cumulation in rules of origin and argue that the obvious solution to this is for the UK to agree to the EU’s Pan Euro-Mediterranean Rules of Origin (PEM) which are the basis of the EU’s cumulation arrangements with a wide range of its neighbours. Any other outcome is likely to reduce the UK’s take up of trade preferences in its FTA with the EU.
Read Briefing Paper 45: WE’RE GOING TO MAKE THEM AN OFFER THEY CAN REFUSE: RULES OF ORIGIN AND THE UK-EU FREE TRADE AGREEMENT
Briefing Paper 44 – SHOULD THE BREXIT STERLING DEPRECIATION HAVE BOOSTED EXPORTS? HOW EXCHANGE RATES AFFECT TRADE AND PRICES
In this briefing paper, Dr Ayele and Professor Winters look at whether the immediate effect of the result of the Brexit referendum – the depreciation of sterling relative to all major currencies and the failure to increase UK exports after 2016 – could have been foreseen. They provide a brief description of recent UK trade history, followed by a review of different studies of the effect of exchange rate changes on trade prices, consumer prices and trade quantities. Finally, they explore the apparent effect of the sterling depreciation in June 2016 on UK trade and price behaviour. The authors show that the pass-through of exchange rate changes to trade and consumer prices and thence to trade quantities is rather complex, and hence difficult to predict with any confidence. They conclude that the failure of UK exports to boom was in part due to the dramatic increase in trade-policy uncertainty that the Brexit result heralded.
Read Briefing Paper 44: SHOULD THE BREXIT STERLING DEPRECIATION HAVE BOOSTED EXPORTS? HOW EXCHANGE RATES AFFECT TRADE AND PRICES
Made in England? Why the UK Government wants Korean and Japanese goods to have same trade benefits as home made products
3 July 2020
A car constructed entirely of Korean components could be classed as Made in Britain under proposals put forward by the UK Government to the EU, our new analysis reveals.
As part of its negotiations over a Free Trade Agreement (FTA), the UK is calling on the EU to allow it to escape EU tariffs on products made with imported parts from any country in the world that both the EU and the UK have FTAs with.
The UK Government is requesting that goods using inputs imported from third parties should be treated as if they had been made in the UK so long as the two relevant FTAs have equivalent rules of origin. […]
