The UK’s post-Brexit trade strategy must avoid harming the world’s poorest countries if it is to achieve its aim of becoming a leader in the global economy, experts at the Overseas Development Institute (ODI) have warned.
In a new paper published ahead of the inaugural Commonwealth Trade Ministers Meeting in London next week (March 9-10), economists at the UK’s leading think-tank on international development say the UK government has so far overlooked Brexit’s impact on the trade interests of the poorest developing countries.
The paper, ‘Post-Brexit trade policy and development’, outlines how Least Developed Countries (LDCs) stand to lose £323 million annually if their current preferential trade terms are not secured in the UK. So far, the UK government has omitted the poorest countries in the definition of its trade policy after Brexit.
ODI experts have now urged the government to make sure its trade and international development policies are aligned and to ensure the current terms of market access for developing countries in the UK are not made worse after leaving the EU.
Researchers show just how vital trade with the UK is for many developing countries, with 9% of exports from Bangladesh and 8% from Kenya going to the UK.
Maximiliano Mendez-Parra, Senior Research Fellow at the ODI, said: ‘Our research shows that while trade with the UK is vitally important for many of the world’s poorest countries, it also brings major benefits to the UK economy, for example through cheaper clothing or agricultural products. The UK should pursue these ‘win-win’ opportunities in its new trade policy.
‘As the UK now attempts to become a leader in the global economy post-Brexit, it is important that it does not harm the poorest countries in the process. In fact, any new trade agreements should go much further by extending the measures in place which already support trade between the UK and developing country partners.’
Dirk Willem te Velde, head of the International Economic Development Group at ODI, said: 'In this week in which Commonwealth Trade Ministers convene in London, the UK could signal its commitment to a truly global Britain by agreeing to roll over preferential access for the poorest and most vulnerable countries as it leaves the EU.'
The paper makes a number of recommendations to ensure the UK's new trade and international developing policies are aligned, including:
- Apply the principle of 'do no harm' and avoid damaging the poorest countries as it leaves the EU, by maintaining existing preferences for LDCs and looking to go further
- Prioritise developing countries in the rolling-over of existing free trade agreements
- Pursue ‘win-win’ options, such as more liberal rules of origin, preferential access in services and Aid for Trade
- Ensure the UK's new trade policy is simple, predictable, transparent and realistic
Notes to editors
- The policy brief ‘Post-Brexit trade policy and development’ is due to be published on Sunday, March 5
- The Commonwealth Trade Ministers Meeting will take place in London on Thursday, March 9 and Friday, March 10, 2017
For more information or to speak to the paper’s authors please contact James Rush on [email protected] or +44 (0)7808 791265