Forget global Britain – thanks to Brexit, coronavirus and a trade war with China, we’re losing our grip

If the British economy is going to recover and go on to grow in the 2020s, it needs markets. But the opportunities seem to be contracting rather than expanding

Sean O'Grady
Monday 13 July 2020 11:02
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Government building 'lorry park in Kent' for post-Brexit checks says Rachel Reeves

Let me see if I’ve got this right, then. By the end of this year Britain will: have failed to conclude a free trade deal with our largest trading partner, the EU; have made little progress in new ones with America, Australia, Canada and New Zealand; be embroiled in a likely trade and sanctions war with China; and have risked the remaining economic/financial relationships from Saudi Arabia to Russia under our our newly minted ethical foreign policy (although that isn’t to say those issues aren’t important).

The Japanese have given us a few more weeks to conclude a continuity free trade deal, which might not be good news, and negotiations with an another coming economic superpower, India, complicated by the visa issue, are yet to start. Meantime, the trade secretary, Liz Truss, has warned her colleagues that the UK’s border controls are so poor the country is in danger of breaching World Trade Organisation rules.

So that’s what they mean by “Global Britain”.

The effects will be awful. Even now, four years on from the referendum with endless debates about customs arrangements and at least three campaigns to “Get Ready for Brexit”, Britain still isn’t prepared, physically or emotionally, for the changes soon to come – from Brexit, but also all those other international developments. It is all deeply damaging.

According to those in charge of our telecoms structure, kicking Huawei out of the system could mean 10 years of our mobile phones not working very well. More broadly, it means no “new opportunities for Independent Britain” in China. The golden age of UK-China relations is over. That means no new Chinese inward investment into the UK, whether destined to make electric vehicles in the Midlands or for banks in the City of London. No-deal Brexit is about much more than not being able to take your pet dog to the Dordogne every summer; it means no markets for Welsh lamb or Scotch whisky.

America? If Joe Biden takes over from Donald Trump in the autumn it will mean Britain will be even more ignored, and Washington will look to the EU as the major force in Europe, as it usually has. The old role of the UK as a bridge between the US and the EU depended on Britain being in the EU. It will disappear – and sentiment about Churchill will not rescue it.

The UK will thus have even less leverage and influence in America and, in concrete terms, the Americans will be dictating the terms of a trade deal, chlorinated chickens included. Trump wasn’t that much use to Britain in the first place, but Biden will be even less bothered because he doesn’t despise the EU. Where are the new jobs going to be generated, as we lose so much employment in sectors such as travel, retail and hospitality? If relationships with other nations change, it is difficult to see where our export orders are going to come from.

There’s something heroic about Britain trying to chuck its weight around this way, and of course no one wants to do business with bullies and tyrants. But still, if the British economy is going to recover from the coronavirus-induced recession and go on to grow in the 2020s, it will need its friends and its markets – and the British now seem intent on blanking virtually everyone. The opportunities seem to be contracting rather than expanding.

As everyone agrees, the UK is a great trading nation, and since before the industrial revolution has made its living from selling abroad, but we don’t seem to be living up to the original hopes of “unleashing Britain’s potential”.

Say, just for the sake of argument, that Dominic Cummings’s dream of Britain becoming a world force in areas such as artificial intelligence, cyberwarfare and other high-tech developments comes true – who are we going to sell this stuff to? Maybe Britain will have achieved such technological prowess that the rest of the world has no choice but to send their orders in, but that’s not necessarily going to happen.

Britain might also be forced into a race-to-the-bottom low-cost production of goods and services to try to get over tariff barriers and generally become internationally competitive, junking labour and environmental protections along the way. We could raise our standard of living by taking advantage of the best-value goods and services on world markets as an open economy – but it will put a lot of farmers out of business. The cumulative economic dislocations of Covid-19 and Brexit will be unprecedented, and will test the fabric of society and the Union to the very limit.

Maybe Britain in 2030 – perhaps after a second term of the “people’s government” – will have a bit of both types of future. By the end of this decade Britain would be a land of mega-salaries (for a few) and low-grade work and mass unemployment (for the rest), a society arguing about identity, race and statues rather than class and economics.

Simon Calder explains how passports could be affected post-Brexit

I am, of course, assuming here that the Conservatives will nonetheless still be in power. This is plausible. They understand power and – thanks to their skilfully deployed culture wars, curbing the media, civil service and courts, using public money for party propaganda, and a fairly blatant suppression of the franchise – they’ll hang on to it.

In case you’d not noticed, we are governed by a bunch of well-spoken but ruthless types who think nothing of misleading anyone from the Queen down.

This abuse of power looks to become prodigious as we edge towards an elected dictatorship. One problem is that the constitution is so open to abuse; another is that not enough of the population seems to care about any of this. Boris Johnson’s current lead over Labour, with him having presided over 60,000 excess deaths, suggests he won’t be removed very easily.

As in the 1930s and 1980s, crisis and economic fear usually means people turn to the right. A more unequal society is coming, both in outcomes and opportunities, less free, more isolated in the world, more divided, a nastier place even than today: Little Britain pretending to be Global Britain. Sounds about right.

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