Richard North, 20/01/2020  
 


For all their rhetoric about plans to become a "global trader" once we have left the European Union, the indications are that the Tory world view is remarkably limited, with nothing even approaching a global breadth. Furthermore, this lack of vision seems to be shared by industry and the media, rendering us closer to a "Little England" than a Global Britain.

Subjectively, it would appear that the Johnson administration likes to cast itself as a global player, simply on the basis of its determination to break away from what it sees as the constraints of our membership of the EU, which opens the way for making its own bilateral trading deals with what were formerly termed "third countries".

Thus, we have the UK expected to give priority to trade relations with the US, with reports that we might even open talks with the Trump administration before formally engaging with the EU on plans for our future relationship.

Simultaneously, there are discussions about a trade deal with China, while Johnson is set today to call for "deeper investment ties between Britain and Africa at a summit for leaders of 21 African countries".

While this represents the UK's attempts to extend its reach throughout the world, its intellectual base resides with a programme of export substitution, replacing lost trade with the European Union with opportunities to extend trade with non-EU partners.

As such, this is a step back from the multilateralism which defines our current relationship with the EU, and a reversion to bilateral deals based on a largely obsolete "free trade" philosophy which stems from thinkers who established their ideas more than two centuries ago, when the world was a much simpler place.

Thus, what seems to escape the current breed of Tory trade zealots is the simple premise that trading in the world – i.e., buying and selling from foreign countries – does not necessarily qualify a nation as a major league global player. In the current environment, that would require a commitment to the much wider concept of globalisation, with serious engagement in the processes of integrating global trade systems.

However, if one is to take a cue from Sajid Javid and his comments on breaking away from regulatory alignment with the EU, this does not seem to herald a wider embrace of globalisation. Rather, it seems to presage a retreat from it, almost to a level of "Empire preference", where the UK traded only within a limited group of countries where it could control the terms of trade.

Were this to be otherwise, we would not have had Javid pressing for a broad-brush rejection of "EU rules", apparently not realising that the EU has been over recent decades one of the most prominent advocates (and practitioners) of globalisation. It is quite willingly surrendering its own standard-making capabilities in order to vest them in regional or global bodies, then adopting these standards in its own legislation.

Yesterday, I gave the example of UNECE and WP.29 in the formulation of standards for motor vehicles and parts, where the EU now works on a multinational basis with global trading partners to develop standards with global application.

No better example of this can be seen than in response to the VW emissions scandal, where vehicle emission tests were "massaged" to give far better results than could be achieved in practice. Now, we have UNECE working on global methodology to measure on-road car emissions, a process where:
The European Union, Japan and Korea are leading the development of the regulatory text that would lead to the establishment of a United Nations Global Technical Regulation on real driving emissions testing, which is expected to be adopted by 2020. The United States of America, Canada, India and China have also showed support to the initiative and are expected to participate in the development of the regulatory provisions, in a process which is transparent, data-driven and open to inputs from all parties involved.
In what is a fascinating development, we find the European Union, Japan and Korea working in partnership under the aegis of a UN body which will, in time, form the basis of EU law, but also extend to Japan and Korea through the EU's comprehensive trade agreements.

But this is by no means the full extent of process where the EU has "bumped up" its standard-setting to another level. From the sublime to the ridiculous, the EU's marketing standards for fruit and vegetables are now drafted by UNECE which works with the OECD in Paris to produce detailed codes.

By such means, we find that the EU's infamous "straight cucumber directive", is no more. It has been replaced by UNECE Standard FFV-15 on cucumbers, given legal effect in the EEA by Commission Implementing Regulation (EU) no 543/2011.

This process of globalisation has been going on a long time, and one of the best examples of evolution can be seen in the EU's approach to the classification, packaging and labelling of dangerous substances.

It was in fact the EEC which first legislated on this, back in 1967 before the UK had joined. Then, in Council Directive 67/548/EEC, it saw as its rationale for legislating, "the differences between the national provisions of the six Member States", which were seen to "hinder trade in these substances and preparations within the Community and hence directly affect the establishment and functioning of the common market".

Now, the system has gone global, known as the "Globally Harmonized System" (GHS), under the aegis of the United Nations, but implemented by the EU in Regulation (EC) No 1272/2008.

If the UK was intent on becoming a global player, therefore, it would not be looking to delink its trading legislation from the EU. Rather, it should be identifying those of global origin and endorsing those, while working with the EU and other players on continuing the process of global harmonisation, where we have an equal say in the outcome.

Furthermore, this is what industry should be asking for – with the support of the media. But, instead, one sees the UK's Society of Motor Manufacturers and Traders calling for the continued alignment with EU rules, with the CBI arguing that alignment "supported jobs and competitiveness for many companies".

Neither these industry bodies, nor the media, seem to be aware of the reach of global standards, or of the extent to which the EU has adopted them. Yet, the deeper you dig, the more you find, to the extent that as much as 80 percent of the EEA acquis might owe something to global or regional standard-setting, to say nothing of the growing body of financial regulation.

If the UK is to be a truly global player, therefore, the Johnson administration needs to abandon its vacuous rhetoric on alignment, and get with the programme. Alignment is driving the trading agenda at a global level. And if the EU has realised this, it should not be beyond the wit of the Tories to follow the same trail.






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