Trade in services is not well understood.

Rather than obsessing about services exports, UK policy-makers should focus on investment and ensuring UK remains an attractive destination for services firms to operate out of.

New policy brief by me:…
The UK is a services trade superpower.

It is the only G7 economy that sees more than 50 per cent of its services directly exported (mode 1) from its own soil to the rest of the world.
But it can't get complacent. The UK’s decision to exit EU’s single market jeopardises its position as a hub for multinational services firms to sell to clients across Europe. Policy-makers need to ensure that the slow trickle of business moving to the EU does not become a flood.
FTAs have only a small role to play. They are unlikely to provide new market access for UK services exporters – cf FTA w/ Japan, which did not unlock any additional Japanese services liberalisation over and above what Japan unilaterally already offers other countries.
But FTAs do prevent partners from rolling back existing levels of openness to British services firms. They can therefore help to ensure a stable policy environment for investors in both directions.
I make a few recommendations. UK should:

- prioritise policy stability (no changing rules for the sake of it)
- liberalise the immigration regime; I suggest scrapping visa fees and negotiating labour mobility chapter with EU as a model for other FTA partners
- do its best to embed free flow of data in its bilateral and multilateral relationships
- and engage in long-term regulatory diplomacy; foreign regulators will only let your firms do things if they trust you and your processes.
Anna (@Annaisaac; #FF) put my suggestion that UK scrap visa fees to the Home Office for the morning politico trade newsletter. It went about as well as expected. Not very Global Britain imo.
Anyway, please read the report. Even if you don't learn anything new I'd appreciate it.
There are also some other reports being published this week on trade in services that are worth your time.

This one by UK finance on trade policy and financial services is thoughtful and provides a good overview of the different tools available:…

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More from @SamuelMarcLowe

24 Dec 20
This is the UK’s internal “who won the negotiations scorecard”, apparently. (via @EuroGuido):…
On rules of origin, suggests that compromise found on batteries and electric vehicles (woo!)

But I have questions about the cumulation “Win” ... as the UK opening position was much more expansive than written here, and win looks like what we knew EU was offering.
That’s quite the spin, lads.
Read 13 tweets
7 Dec 20
I have stumbled across some information signalling that EU will agree to allow Northern Irish companies and consumers to continue benefiting from imports under EU free trade agreements (as well as UK free trade agreements). No news on exports.
But points to some good progress being made in joint committee negotiations. And I like good news.
In practical terms, if this comes into effect, would mean NI importers could still benefit from the EU FTAs UK hasn’t rolled over. It also means they wouldn’t have to demonstrate import remaining in Northern Ireland (as is case when using UK FTAs).

Best of both worlds klaxon.
Read 4 tweets
7 Dec 20
Operation put the baby back down to sleep and hope she doesn’t wake up while I’m doing media interviews has begun.
She’s currently standing in her cot and yelping.
Interview one: success!
Read 4 tweets
6 Dec 20
Would be keen to know which of labour and environmental protections covered by LPF it is the UK would like to scrap. Because I suspect the answer is actually none of them.
Is it any of these?

(i) fundamental rights at work,
(ii) occupational health and safety standards,
(iii) fair working conditions and employment standards, and
(iv) information and consultation rights at company level, and
(v) restructuring.
How about these?

i) access to environmental information, public participation and access to justice in environmental matters; (ii) environmental impact assessment and strategic environmental assessment; (iii) industrial emissions
Read 6 tweets
16 Oct 20
Once the transition ends, trade deal or no trade deal, there is going to be lots of accidental business illegality. A lot will be riding on how forgiving/accommodating, or not, the enforcement environment is.
For context, following the Brexit vote quite a few banks reviewed existing process and found out that even within EU they were not exactly always complying with the rules ...
So a scenario: no data adequacy; company still hosts EU personal data on server in UK without contractual cover. What are the consequences? What steps do the regulators take? Heavy handed or give more time to adjust?
Read 4 tweets
9 Oct 20
Is it time to have the long and boring discussion about the difference between standards and processes & production methods?
Trade policy tends to focus on outcomes (standards). So for imported food to be sold on the UK market it needs to be made to UK [or sometimes equivalent] standards.

Trade policy doesn't tend to deal with how (processes & production) the food is made e.g. how cows were treated.
But this is changing somewhat. The EU-Mercosur trade deal opens a tariff-rate quota exclusively for shell eggs birthed (?) from chickens subject to animal welfare conditions equivalent to the EU's.
Read 12 tweets

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