Future International Trade Opportunities

Part of the debate – in Westminster Hall at 5:03 pm on 1st May 2019.

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Photo of Gareth Thomas Gareth Thomas Party Chair, Co-operative Party 5:03 pm, 1st May 2019

I congratulate Craig Tracey on what so far has been an interesting debate. I gently remind the House of the promise that the International Trade Secretary made to have signed some 43 trade deals by the end of March 2019. Not surprisingly, that has not been achieved, and we are some way from seeing those 40 so-called roll-over EU trade agreements signed. That is an indication of the complexity of trade. While, as Julia Lopez alluded to, many things can affect future trading opportunities for British businesses, the instability of not having sorted out proper trade agreements with both the European Union and other key markets is likely to inhibit the international trading opportunities for British businesses.

I raise in particular concerns about trade in services, because the vast majority of the jobs done by my constituents that directly involve international trade are related to services. The few bits of detailed thinking from independent trade experts about the impact of Brexit on trade in services highlight the huge significance of such trade between the UK and the EU, and therefore what is at risk, in terms of scale, for the UK economy from any inhibitions of trade in services.

In 2017, according to the Centre for European Reform, services accounted for some 45% of total UK exports, or almost £300 billion. The EU received 40% of those exports, the highest proportion of any UK trading partner. Research by the Centre for European Reform suggests that if Britain leaves the single market and trades services under the provisions of an ambitious free trade agreement, on an annual basis UK exports to the EU of financial services will none the less be 60% lower, UK exports of insurance and pension services will be almost 20% lower, and exports of other business services, including law, accountancy and professional services, will be 10% lower. Those are all sectors in which Britain has a significant comparative advantage, so jobs, investment and tax revenues are all at risk in the case of withdrawal from the single market.