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The UKTBC has recommended the creation of a new independent agency that would act to DBT as the OBR does to the Treasury. Modelled on the highly regarded Swedish Board of Trade, this new agency will be accountable to the Secretary of State for Business and Trade. 

Our panellists joined the UKTBC in calling for an independent body that could contribute to the trade policy landscape in the UK. The UK Trade and Business Commission recommended that the Board should have a wide remit of work in which to engage. 

In particular the UKTBC recommend that an independent Board of Trade would;

a) Produce an annual trade report

b) Determine the impacts of trade agreements

c) Collaborate with Government and Parliamentary committees

d) Conduct an annual stakeholder survey .

Witnesses

Panel 1: Food inflation; the UK Government’s response to the cost of living crisis; and the challenges that UK consumers are facing

• Anna Taylor, Executive Director, The Food Foundation

• James Withers, Chief Executive, Food and Drink Scotland

Panel 2: The new UK Food Strategy; the impact it will have on trade; and the challenges that UK Agricultural and Horticultural sectors are facing

• Professor Timothy Lang, Emeritus Professor of Food Policy, City University London’s Centre for Food Policy

• Richard Griffiths, Chief Executive, British Poultry Council

• Phil Hambling, Head of Food and Farming, National Farmers’ Union

On 27th November 2023, the UK Trade and Business Commission team went on a site visit to FreshLinc haulage and logistics in Spalding, Lincolnshire.

The introduction of the new Border Target Operating Model (TOM) from the end of January next year will see import checks introduced on products coming into the UK from the EU of plant and animal origin.

As a logistics and haulage business, a huge number of FreshLinc's suppliers are affected by the changes, and FreshLinc is having to navigate the new regulatory landscape on their behalf. With the introduction of the TOM repeatedly pushed back, coping with uncertainty and shifting expectations has been challenging for FreshLinc.

The UKTBC team attended FreshLinc to find out more about the challenges they're facing, and what they need from Government to ensure that the introduction of the TOM does not negatively affect their business. 

The first half of the session explored the challenges of not being aligned with the EU in this respect, and paying a high price for embedded carbon in exports to the EU, may become more apparent as the CBAM implementation process gathers pace.

The second half of the session examined overall issues pertaining to Net Zero and trade, considering the Government’s recent policy blitz on Net Zero and looking at trade as part of a means of reaching Net Zero, rather than an obstacle to it.

The UKTBC Commission recognises the importance of decarbonisation process globally and the further importance of ensuring that efforts by the UK government align with our EU counterparts.

The UKTBC covered UK-EU beneficial regulatory alignment within this session. In particular the UKTBC highlighted the benefits for the UK economy and businesses of bringing its regulatory space in line with the EU’s. Such regulatory alignment would remove some of the trading barriers which have hamstrung British growth and entrepreneurship since Brexit.

The UKTBC also looked at the road to negotiating a reciprocal youth mobility scheme between the UK and EU and highlighted the importance of such a scheme for economic, social and cultural purposes.

Since it was established in 2021, the UK Trade and Business Commission (UKTBC) has been working to understand how our new trading relationships are impacting businesses and different sectors of the UK economy. And now we have the solutions.

We have hosted 38 evidence sessions, performed site visits, taken over 80 hours of live testimony from 234 expert witnesses, industry leaders and business owners and received written evidence submissions from over 200 organisations as part of an open consultation.

This report is a product of the extensive work we have undertaken and the valuable insights gained have culminated in the development of 114 actionable recommendations. These recommendations are designed to enhance the UK’s trading relationships, foster business growth, and navigate through the current challenging landscape.

The majority of global trade today involves global value chains, creating a highly interdependent system. As the UK’s place in global trade is changing, it is increasingly important that the UK adopts a forward looking approach and considers how trade deals and international relationships can best support UK’s economic growth. The Commission heard from six expert witnesses on what the UK Government should learn from the current state of play in global trade.

The UKTBC found that;

a) UK trade has reduced significantly since Brexit and new trade deals forged by the UK Government have not yet had a big impact.

b) The UK can learn from other countries how best to position itself within the current global trading environment.

c) The UK does not have a coherent, demand-led and worker-centred approach to trade policy. Aligning domestic policy and national security with trade strategy will allow the UK to improve and develop its position in international trade.

Worker shortages and skills shortages sit side by side. While importing labour cannot be seen as the full solution to workforce shortages, it may be the only solution several industries can adopt in order to immediately alleviate labour pressures they are feeling. Similarly, with regards to skills shortages, training alone cannot be the answer without proper solutions in place for forecasting worker shortages in the immediate and longer-term future. 

Skills shortages are also part of the questions surrounding the UK as a destination for inward investment or FDI. A huge risk to FDI into the UK is an inadequate skills infrastructure. Without being assured of staffing and skills capacity, companies will be reluctant to open new branches in the UK. 

Brexit has had an undeniable impact, leading to workforce shortages, long term uncertainty over regulation and new administrative processes. Trade deals offer an opportunity to address some key issues facing the sector and therefore help UK healthcare grow post-Brexit but witnesses also highlighted concerns about how future trade deals could negatively impact healthcare in the UK.

The report highlights the importance of regulatory alignment with the EU and maintains that healthcare should be an important aspect of future trade negotiations, whilst keeping the privatisation of the NHS off the negotiating table.

The Commission heard evidence from six expert witnesses on what role devolution and levelling up have in future trade deals. The Commission heard views on how international trade policy, a reserved matter, interacts with diverse range of devolved regulation. In the second panel of the session, Commissioners also explored how future trade deals can support the levelling up agenda.

The key findings of the report produced by the UKTBC were that:

a) It is necessary for a trading strategy to consider regional and local contexts for it to work for businesses across the UK.

b) Devolved governments are important stakeholders in trade policy, but the institutional structures that have been put in place to support their involvement are not effective in practice.

c) Brexit has impacted both devolution and regional growth across the UK.

The first panel focused on the pressing environmental issues of today and how trade deals can encode new and higher standards of climate protection. Trade deals can be tools that actively facilitate positive climate action, encouraging high climate standards within and beyond trade deals.

The second panel focused on standards and protections. Now that the UK has left the EU, it is more important than ever to maintain high standards and strong regulation of these standards to aid cooperation and trade with neighbours but also for consumer confidence and production.

This session covered environmental and standards protection policies as well as an overall strategy for how they can be a key part of trade negotiations.

The agricultural sector faces significant challenges following the UK’s exit from the European Union. From workforce shortages to administrative challenges, many farmers are experiencing ongoing down turns in profit and trade.

Fishing was a key issue throughout the Brexit campaign, but is also facing a range of logistic and commercial challenges. The Commission asked six experts across the two industries what trade policies are needed by the UK Government to support these industries.

In this session, the UK Trade and Business Commission met to hear from experts who can outline what the UK Government can do to support the growth of Financial Services and FinTech industries.

The UK is widely recognised for its world leading finance sector. The industries in this sector have been particularly important for UK economic growth for the past thirty years but face new challenges post-Brexit. This session gathered evidence with the aim of gaining an understanding of the challenges, priorities, and future opportunities in finance and financial innovation from a panel of six leading experts.

The UKTBC found that the financial sector is facing unprecedented regulatory uncertainty and furthermore is being undermined by a workers and skills shortage. The UKTBC further highlight the significance of these shortcomings given the importance of the financial sector to the UK economy as a whole.

Post-Brexit, the UK is looking to expand its global reach, and free trade is a major mechanism which the UK deploys to forge international connections. However, there have been concerns about some of the free trade agreements forged so far - with fears that they may flood the UK market with imports that undercut domestic producers, or even drive a race to the bottom in terms of environmental standards. 

The UK Trade and Business Commission took evidence on the best approaches with which to conduct future international trading relationships. Ensuring that trade maximises domestic priorities while also strengthening international partnerships is an important balance to achieve, and it is critical going forward that the UK does not sacrifice its overall aims and goals by rushing insufficient trade deals which do not feed into overall UK objectives. The panel discussed critical trade policy priorities, as well as the considerations that constantly need to be weighed up when forging trade deals moving forward.

Arts and culture is a cornerstone in the UK’s global influence and soft power but creative industries have been badly impacted in the aftermath of Brexit. As the government pursues new international trade deals, the UK Trade and Business Commission took evidence on the current economic challenges facing the creative sectors and what is required in future trade deals to ensure the UK's cultural sector thrives. 

This session analysed the UK’s culture and art sector from a range of perspectives. The committee heard from seven expert witnesses about the significant contribution of these sectors to the UK economy as well as the threats it faces with difficult economic times ahead.

Witnesses highlighted that the sector has a vital part to play in how the UK presents itself internationally. The session explored how the broader economic effects are impacting the UK’s culture sector and considered how the sector can be benefitted by global economic cooperation. Witnesses asked the Government to recognise how the sector can also be a driver for the UK to work with and trade with other nations.

Both the UK’s manufacturing and construction sectors have struggled with challenging economic conditions over the past year - and yet both sectors are pivotal to UK domestic growth. With UK manufacturing predicted to see a downturn over the coming year, it was vital for the Commission to explore how the Government and the trade agreements it forges can prevent sector slump and and grow a sector which provides many high-skilled, high-wage jobs, and historically demonstrates significant productivity for its size. 

UK construction faces acute workforce challenges and is affected heavily by fluctuating demand in the economy.

The UK Trade and Business Commission has taken evidence on several occasions on how staff shortages in the wake of Brexit are impacting different sectors of our economy. Ahead of summer recess, the Commission held this live evidence session to further understand these impacts and other aspects of the post-Brexit landscape. 

For the arts and travel industries the UKTBC identified specific issues regarding labour mobility, red tape, and administrative burdens. All of these issues were found to have a substantial economic, cultural and social cost.

The UK Trade and Business Commission has taken evidence on several occasions from a wide range of stakeholders on the Northern Ireland Protocol. This involved the Commission making a visit to Belfast in March 2022. In June 2022, the UK Government introduced a 'Northern Ireland Protocol Bill' proposing significant unilateral changes to existing agreements between the UK and EU.

This session of the UK Trade and Business Commission took evidence from experts on the Protocol about what the diplomatic, geopolitical, and economic consequences of the bill could mean for trade and businesses in Northern Ireland.

The UK has become entrenched in one of the worst cost of living crises since records began at the time of this session, and one facet in which this is being felt most sharply is on food prices. Whilst this crisis is ongoing, the UK continues to determine its post-Brexit food and agriculture policy.

The UK Trade and Business Commission used this session to look at the areas which the UK should prioritise in terms of food policy moving forwards; the issues that the UK Government need to fix in order to relieve the pressures of the cost of living crisis; and how UK Agriculture can be better supported moving forwards.

Co-Convenors of the UK Trade and Business Commission Hilary Benn MP and Peter Norris led a delegation to Kent on Monday 16th May.

This was the Commission’s second ‘seeing is believing’ style visit, following on from their previous trip to Northern Ireland.

During the morning, the delegation visited Winterwood Farms, a soft fruit farm in Maidstone who grow, export and import a range of fruits such as blueberries, raspberries and strawberries.

Then in the afternoon, the delegation visited the Port of Dover which involved a walk up the cliffs to see an aerial view of the facility before then getting an up-close look at the Port.

As a result of the site visits to Winterwood Farms and the Port of Dover, the Co-Convenors of the Commission sent two letters to the UK Government setting out their findings and recommendations.

Letters to Rt Hon George Eustice MP and Rt Hon Priti Patel MP