Four former trade and business secretaries have criticised Boris Johnson’s claims that he can strike a comprehensive trade deal with the European Union by the end of 2020.
In interviews with City A.M., Sir Vince Cable, Lord Michael Heseltine, Lord Peter Mandelson and Lord John Hutton – all ex-presidents of the Board of Trade – raised a number of issues that could scupper the Prime Minister’s plans.
One was that rushed talks would not yield a good deal for financial services firms, which make up seven per cent of the economy. Former Liberal Democrat leader Cable said: “There is a big gap in expectations between what the City would like and what’s likely to come out of a trade agreement that was negotiated quickly.”
However, former trade secretary Lord Peter Lilley said a free-trade agreement is “eminently doable” in the timeframe. He said Britain would simply have to let go of the idea of “a perfect deal”.
The ex-cabinet ministers were split along Brexit lines, with Cable, Heseltine, Mandelson and Hutton all pro-Remain, and Lilley a Brexiter.
Nonetheless, there was broad agreement that a trade deal could be struck quickly if the UK chose to keep roughly the same tariffs and regulations, given that it is currently identically aligned with the bloc.
Yet Johnson has expressed a desire to move away from the EU in a bid to strike trade deals with countries such as the US.
Mandelson, a former EU trade commissioner, said the government cannot have this kind of “economic freedom” and preferential access to its biggest export market and a key financial zone. “It’s a binary choice,” he said.
Figures such as former EU finance commissioner Lord Jonathan Hill have argued that Britain’s financial eminence means it should go its own way and refuse to be rule-takers, however, although they concede this will come with costs.
Hutton, business secretary under Gordon Brown, said a major problem is that the UK is yet to work out what it wants from the trade talks. He said a “grown-up debate about… some of those choices and policy options” is sorely needed.