Dr Liam Fox MP Keynote Speech Conservative Spring Forum

 

Over the past few months since the Prime Minister created our new Department for InternationalTrade, our ministerial team have been on 76 overseas ministerial visits to 44 markets.

 

Our message has been that Britain is open for business as never before. It is a message that has been enthusiastically welcomed by our friends and partners in every corner of the globe. Yet, we should not really be surprised.  

For, as I have repeatedly been reminded, thiscountry, our country, has long been associated with both the concept and practice of free-trade.

 

A small island perched on the edge of the European continent became a leader of world trade.  For over a century the terms ‘Britain’ and ‘free trade’ were virtually synonymous.  

 

It was from here that those such as Adam Smith in 1776 who set out the intellectual case for free and open commerce - arguments that are just as valid today.

 

This is why the Prime Minister’s ambition for a Global Britain is so in tune with our national character and why I passionately want to see it succeed. 

 

THE CASE FOR FREE TRADE

 

It is easy for us to take for granted the system that created the modern global economy and set the conditions for globalisation itself. 

 

Yet, many of our citizens question the benefits of these free trading arrangements so we must constantly remind them of the advantages that they bring.

 

So much of what has become our accepted way of life are the products of a free trading system – the majority of the clothing we wear, and almost all of the technology we use, is the product of a supply chain that stretches across the world.

 

Citizens of all countries will, perhaps unknowingly, be using products that originate from across the World, their components and raw materials drawn together by the global economy into a finished item.

 

Every individual, too, is an actor in free trade. When a family from Cardiff in Wales holidays in Italy, they are engaging in international trade.

 

When an Indian student in Los Angeles withdraws money from their home bank account, they are part of the global economy.

 

When someone in South Africa uses their mobile phone, they are able to do so because of technology created here in the UK.

 

The explosion of research, innovation and manufacturing across the world has done away with the constraints of geography.

 

And while the world has shrunk, our ambitions have grown.

 

 

LIBERATION FROM POVERTY

 

Yet free trade is about more than the simple provision of goods and services - it has also been the means by which we have liberated millions of our fellow human beings from poverty.

 

According to the World Bank, in the 3 decades between 1981 and 2010, we witnessed the greatest single decrease in material humandeprivation in all of history.

 

At a time when the population of the developing world has increased by almost 60%, the number of those in extreme poverty has dropped from around 50% to around 20% – still too many, but a phenomenal achievement in which we should take great pride.

 

And as we align our trade agenda with our development agenda, led with distinction by PritiPatel, we have the opportunity to do even more.

 

In a single generation we have taken one billion people out of abject poverty, the largest number in the whole of human history.  Astonishing – but still unfinished business.

 

The threat of protectionism

 

It is worth reminding ourselves of this positivenarrative about trade and the improvement in the human condition that it has brought about because in the world around us there is a rising chorus of protectionism which threatens to drown out the case for a free and open global trading system.

New barriers, many of them invisible, are emerging around the global economy creating new impediments to the open commerce that is the lifeblood of global prosperity.

 

What is worse, many of these impediments are being introduced by G7 and G20 countries, the very nations who have prospered most from the open, liberal trading system of recent decades.

 

Research by the OECD has shown that protectionist instincts have grown since the financial crisis of 2008. By 2010 G7 and G20 countries were estimated to be operating some 300 non-tariff barriers to trade – by 2015 this had mushroomed to over 1200.

 

Protectionism can be seductive but is a dangerous liaison. I have described it as the class A drug of the trading world – it can make you feel good at first but it can prove disastrous in the long term.

 

It is economically destructive, preventing us from reallocating global resources effectively. It is also socially regressive because those on lower incomes spend a higher proportion of their money on goods than services so tariffs and barriers will hurt the poor more. 

 

And we will all pay the price if those denied the opportunity of global prosperity turn their backs on the partnerships and cooperation that underpin global security. 

 

We all must ensure that those who have most benefited from open and free trade do not pull up the drawbridge behind them and deny the same benefits to others.

 

So, as we establish our own position after we leave the European Union, Britain will proudly carry the standard of free and open trade as a badge of honour.

 

As we, one of the world’s largest economies, take our independent seat at the World Trade Organisation we will seek to achieve continuity in our trade and investment relationships with our trading partners around the world.

 

That is the message and the reassurance that   ministers across the whole of government take to countries in all parts of the globe.

 

The UK remains committed to pursuing free trade. That includes ensuring that the developing countries that we trade with are no worse off following our EU departure.

 

Yet we understand that trade can never be an isolated policy objective.

 

It is an unavoidable truth that prosperity, including an open and free trading environment, social stability, political stability and security are part of the same continuum.  By that I mean that you cannot disrupt one element without disrupting the whole.

This is part of the reality of globalisation – the interconnection and interdependence of the world we live in.  The geographical barriers that have existed in the past are being broken down by technology – with enormous potential benefits but also unavoidable risks.  

 

It means that a problem in one part of the world – be it economic, natural disaster or security – can ricochet around the world quickly.  That is why we must work to diminish risk wherever and howeverit arises.  In the 21st century the phrase ‘over there’ may have much less relevance than it has in the past.  This can be seen no more clearly than in the world of trade.

 

 

For the first time in decades, the established order of fair, free and open global trade, which has done so much to enrich and empower the world’s nations, is under threat.

 

Between 1985 and 2007, global trade volumes increased dramatically, growing at around twice the rate of GDP.

 

Since 2012 they have barely kept pace.

 

Perhaps most significantly, in September last year, the World Trade Organisation downgraded their forecast for global growth in the trade in goods from 2.8% in 2016 to just 1.7% this year.

 

This is an implicit prediction that, for the first time in many years, trade will grow more slowly than GDP.

 

These predictions would be concerning on their own, but they come at a time when thatundercurrent of protectionism is once again beginning to tug at global commerce.

 

We must all act together to create the conditions for the improvements in global trade that will be the precursor to greater global prosperity.

 

 

 

TRADE AND BREXIT

 

Yet if trade is to be a vital part in shaping Britain’s global future, then it must also help shape the future of our relationship with the EU.

 

The United Kingdom may have voted to leave the European Union, but we will never leave Europe.

 

Our partners across the continent will remain among our closest friends and allies in commerce, security, and many other ways.

 

But we want to realise a new relationship with Europe based upon open trade and mutual prosperity.  It lies at the heart of the approach of David Davis and his team.

Given the challenges facing commercial interests across the globe, we should all consider whether we really want to create barriers where none currently exist.

 

So, we must be absolutely clear that any new impediments to trade and investment in Europe would not only be politically irresponsible, but economically dangerous – and not just for Europe but for the wider global economy too.

 

We do not act in a political vacuum and our economic actions will have global implications.

 

Britain wants the EU to succeed, and to succeed in a competitive and open trading environment.

 

It is in the interests of the British government to have a strong, stable and prosperous European Union as our immediate neighbour.

 

Our co-operation on defence, intelligence and security has been one of the most successful such projects in history working alongside our key allies in North America.  It is a legacy that Michael Fallon and Boris Johnson are building upon.

 

Economically, too, the benefits of continued partnership are clear to see.

Commercial and economic interdependence is the future – protectionism is no longer simply import tariffs and border checks by uniformed customs officers, but anything that jeopardises the free flow of resources and capabilities between companies located in different countries.

Our European partners must accept the responsibilities we all have to global trade and stability outside Europe’s borders.

 

The Prime Minister made clear in her landmark Lancaster House speech that we will not be members of the Single Market though we will want to trade with it as fully and openly as possible.

 

We know that when we leave the EU we will not have an EU Commissioner, MEPs or a seat at the European Council. That is a political decision that we have consciously taken following the instruction from the British people at the referendum. It is a political response to a political decision. 

 

But it would surely be wholly inappropriate if our political decision was to be met with an economic response – in other words, if barriers to trade and investment were introduced across Europe that would damage the economic potential of all European citizens and those well beyond Europe too.

That would be self-defeating.

 

BRITAIN: READY FOR THE CHALLENGE

 

As Britain prepares for the challenges and opportunities ahead we need to do two things. The first is to address some of the underlying weaknesses that might undermine our futureeconomic potential. The second is to understand the natural advantages we have and exploit them to the full.

On the day Theresa May took office as Prime Minister, she rightly decided to put trade back at the heart of government.

 

I am proud to be the first dedicated Secretary of State for Trade in decades and I am fortunate to be assisted by three of the most talented ministers in government – Greg Hands, Mark Price and Mark Garnier.

 

They bring expertise and endless hard work to the task and we are ably assisted by our terrific PPS’s – Iain Stewart and Helen Whately and our wonderful Government Whips – Heather Wheeler and Baroness Mobarik.

 

 

Together, one of the main problems that we are tackling is a relatively poor performance when it comes to exporting.  Only 11% of British companies currently sell either goods or services beyond Britain’s borders – we must do better.

 

That is why the government has been working with business to make it easier to become an exporter, providing assistance on legal cultural and financial implications of entering an export market. 

 

In November we launched the world’s most advanced digital portal for trade.  Since then, our great.gov.uk site has had some 2 million unique hits, almost 20,000 individual responses to export opportunities, and helped over 9500 (9786) export ready companies find a buyer. 

 

And I want to see better exporting across the whole of the UK which is why the Department for International Trade is set up to serve the whole of our country.

 

Unlike Nicola Sturgeon, I along with the rest of government want to ensure that the increased prosperity that we might generate from a better export performance is shared across all parts of our United Kingdom.

 

While the Nationalists look backwards to the past, we must look forwards to the future.  Where they focus inwards we must focus outwards.  Where they seek division of our peoples we must seek unity of purpose.

 

We will use the advantages that we possess not only to encourage a better exporting performance across our whole country but to attract further investment into our country creating more jobs and greater prosperity for everyone.

 

When I have spoken to potential investors from Chicago to Hanoi, from Dubai to Singapore, they tell me the same story.

 

When I ask why they want to invest in the United Kingdom the answers are all the same.

 

First, they say, we know and understand your legal system which provides confidence underpinning our investment.  Then, they tell me, you have a skilled workforce and a low regulation, and low taxation economy.  

Then they will talk about our world-class universities and our increasingly admired research base.  We speak English, the natural language of the business world and we are in the right timezone to do business with Asia in the morning and America in the afternoon.

 

All of these together make Britain the natural place to do business and when we tell them that, as we prepare to leave the European Union, Britain is open for business as never before then we become an even more attractive place to invest.

 

We will use our new industrial strategychampioned by Greg Clark to ensure that Britain has the necessary skills to navigate the 21st-century economy.  For too long vocational skills have been undervalued when compared to academic ability.  This we must reverse.

We need to encourage concepts of lifelong learning with the ability to access ongoing skills improvement if we are to compete in an era where change is inevitable and where the most flexible and agile economies will prosper most.

 

It is at the heart of the PM’s mission to create an economy that works for all.

 

So it is time for us to ignore the siren voices, the naysayers and the doom-mongers.  Instead of talking Britain down it is time to talk up our opportunities, our skills and our talents.

 

Our Plan for Britain is not for a nation cowering in the international shadows but confident, strong and optimistic, willing to lead not follow and helping to shape the world around us.

We will ensure that we create the wealth that will allow the next generation to enjoy all the things we enjoy today, and more.

 

We will contribute to global stability by ensuring that the developing nations have the same opportunities as the rich ones in an open, globaltrading world.

 

 

 

 

 

 

 

 

It is a Conservative vision of opportunity given;

 

of effort rewarded;

 

of benefits shared at home and abroad;

 

confident in our leadership;

 

proud of our people;

 

and strong in our resolve. 

 

THANK YOU

 

ENDS