UK Foreign Secretary Boris Johnson has said establishing free trade deals with fellow Commonwealth countries following Brexit will not detract from plans to strike a similar deal with the European Union
UK Foreign Secretary Boris Johnson has said establishing free trade deals with fellow Commonwealth countries following Brexit will not detract from plans to strike a similar deal with the European Union.
Brexit refers to Britain’s decision to leave the European Union, of which it has been a member since 1973.
The Brexit referendum took place on June 23, 2016, when 51.9% of voters opted to leave the EU.
Johnson said a combination of EU and Commonwealth free trade deals could be a “win-win” situation for the UK in response to Conservative MP Daniel Kawczynski’s comments that the Foreign Office should start looking at how the UK could recalibrate the country’s exports policy to focus on the Commonwealth.
Head of International Trade Policy at the Commonwealth Secretariat, Mohammad Razzaque, noted that the `Commonwealth Advantage’ would be instrumental in securing greater trade and economic gains for a post-Brexit Britain.
Intra-Commonwealth trade has tripled since 2000 from around to US$200 billion to over $600 billion in 2017, said Razzaque, and members tend to trade on average 20% more than non-members.
Bilateral trading costs are therefore 19% lower on average compared with other partnered countries, and member nations generate 10% more direct foreign investment flows on average.
This is despite functioning as a voluntary association of countries with a wide geographical dispersion.
Many of these nations are also members of several non-Commonwealth regional and bilateral trading blocs, taking advantage of trading opportunities with economic powers such as the USA, Japan and the EU.
Historical ties, a common language and legal system, and long-standing trading relations all contribute to the trading strength of the Commonwealth network, according to Razzaque.
The UK currently absorbs approximately 18% of Commonwealth developing countries’ exports to the EU.
Upon leaving the EU single market, the UK will have to establish its own trade arrangements to ensure its continued stronghold on international trade and, potentially, an increased export drive.
Foreign Secretary Johnson said: “With 2.4 billion people and some of the fastest growing economies in the world, the 52 countries of the Commonwealth represent a superb opportunity for this country to do free trade deals.”
Read More: Mohammad Razzaque, Head of International Trade Policy at the Commonwealth Secretariat, highlights the so-called ‘Commonwealth advantage’ in trade and its likely interactions with Brexit-related consequences, also considering opportunities for securing greater trade and economic gains for Commonwealth members in a post- Brexit world