As the UK faces one of its toughest policy challenges in designing a new trade strategy in the wake of the vote to leave the European Union, leading trade economists have come together to consider how the UK’s new trade policy could contribute to development.
It is calculated within the essays, titled ‘The impact of the UK's post-Brexit trade policy on development’, that the poorest countries save a total of €385m annually due to their preferential access to the UK market through the EU’s trade policy – a significant amount which could be lost if a trade deal with similar terms is not negotiated between the Least Developed Countries (LDCs) and the UK post-Brexit.
As the UK prepares to negotiate its own trade deals outside of the EU, these essays show how a new UK trade policy could go beyond the current benefits developing countries receive from EU preferences.The essays conclude a new UK trade policy could be more beneficial to developing countries by going beyond lower tariffs and including new provisions on services, investment, rules of origin, standards and Aid for Trade.
A further €205m (£172m, $229) annually could be lost by non-LDC African Caribbean Pacific developing countries (such as Ghana and Kenya) who also benefit from preferential access in the UK market.
The essays highlight that in a scenario of multiple negotiations faced by the UK, there is a danger that developing countries may be overlooked. The UK must ratify sooner than later the continuation of the duty free and quota free access for Least Developed Countries and consider transitional arrangements to secure existing level of market access for other non-LDC countries.
At the same time, the UK could benefit by up to US$7.3 billion (€6.5 billion; £5.5 billion) by negotiating free trade agreements with major emerging markets to which the EU has not so far negotiated free market access - though questions are raised about the chances of actually concluding deals with countries such as China and Brazil.
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