Most people don’t think about trade. Supply chains, tariffs, subsidies, they’re boring — until they’re not: when jobs and entire industries disappear, when shelves go empty or when other countries start making the rules and we’re just told to follow them.
The two most interesting experiences in my years as trade secretary until July last year were firstly the US’s increasing protectionism — yes, even under the Biden administration — and the lack of interest in our biggest trade deal since Brexit: CPTPP, the trans-Pacific partnership. The CPTPP involves 12 countries. Five hundred million consumers. A trade bloc bigger than the EU, including many countries dealing with the consequences of President Trump’s tariffs, such as Japan, Canada, Mexico and Australia.
Yet it never got the attention it deserved. Why? Partly because trade is complex, but also because commentary focuses on the familiar. Trade was written about frequently as us choosing between the EU v the US. This is a false dichotomy. The consequence is that much of the government’s rhetoric on trade boils down to how much we should align with the EU. This shows a lack of ambition and also a lack of understanding about what trade is. Trade is about more than tariffs and paperwork. It’s about power, security and how we shape the world.
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It is obvious we should be engaging more with our international allies, but this has to be more than the EU. A smart thing for Keir Starmer to do would be to take the lead in convening a meeting of CPTPP trade ministers to deal with the tariff wars. We can both be a strong advocate of global free trade and seek a trade deal with Trump.
But first let’s be honest. The United States, once the biggest champion of free trade, dramatically retreated from its global leadership role a long time ago. This is why, once we left the EU, the Conservatives immediately began negotiations with the US. We could see which way the wind was blowing. The Biden administration cancelled the UK-US trade deal, preferring smaller-issue specific deals, for example on security or critical minerals. Yet even these mini-deals exposed the fragile nature of international trade relationships. What should have been straightforward with our closest ally became frustratingly complex. The Biden team repeatedly stalled negotiations, often raising what I considered bureaucratic obstacles. They would demand additional labour rights provisions, despite the UK already maintaining labour rights far superior (or more onerous, depending on your point of view) to those of the United States. The EU didn’t have any luck either.
Starmer has an opportunity to pick up where we left off with the first Trump administration. However, it is absolutely critical that he does not go backwards on what we agreed. In 2020 the Conservative government had six rounds of positive negotiations with the first Trump administration. There were genuine gains such as mutual recognition of professional qualifications and better access for UK dairy. Starmer must deliver real gains, not a deal where the UK concedes what it already has done to avoid an unjustified new set of tariffs.
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However, given that the Labour government has lost Sir Crawford Falconer, our most experienced trade negotiator, and not shown any interest in asking former Conservative ministers about our experience, I am not convinced that they are taking any negotiations particularly seriously or even know where to start. The Department for Business and Trade, sadly, is now like the Department for Education — run by union interests for union interests. Instead of focusing on expanding our trade horizons, it has become bogged down with the Employment Rights Bill, which will handcuff so much of business and contribute to an already stagnating economy following Labour’s two disastrous budgets.
It needs to refocus on trade, start to calculate the trade-offs of globalisation and mitigate negative aspects. This requires Labour to take strong decisions fit for the changing world rather than blindly align with old EU regulations because it is too lazy to think for itself.
Our journey since Brexit has been transformative, yet fraught with challenges that demand our immediate attention and strategic action. When we left the European Union, we gained something profound: an independent trade policy. But this requires leadership, not just catchy phrases or random announcements. So far Keir Starmer seems adrift on trade policy; achieving nothing, having no clear objectives and only responding to, rather than influencing, what is happening in the world. We can’t afford for this to be another area where Starmer is all talk and little action. He’s been prime minister for coming up to a year now; it’s on him and there’s nowhere for him to hide any longer.
The emerging world order demands that the UK position itself strategically. We are an island nation that has built up almost all of our wealth through trade. The rules-based trading system has worked heavily in our favour on trade disputes and in protecting our most valuable industries, from agriculture to finance. Without it, there will be more instability and uncertainty.
But we also have to accept that the status quo is failing many people across the world. The US’s issues with the global trading system are not irrational but starting tariff wars makes things worse. Criticising globalisation’s negative aspects doesn’t mean dismantling the entire system. Instead we need sophisticated engagement: holding countries such as China accountable when they refuse to play by the rules is the only way to maintain the integrity of those rules. Throwing them out will give the advantage to those countries who use, for example, slave labour and poor standards to compete.
Keir Starmer needs to get a grip on a lacklustre trade department that has shown no initiative in solving these problems. It is one of the most important departments in government and will shape all our futures. That needs lateral thinking and a reminder that trade is about power, security and how we shape the world. Starmer can either embrace our role as an independent trading nation, as the Conservatives did. Or he can drift. Repeating the same tired arguments, stuck between yesterday’s unions and tomorrow’s uncertainty.
