The UK’s commitment to leave the EU requires a new international trade and commercial policy. For decades these policies have been decided at the EU level, via the EU institutions, and requiring – in the case of Free Trade Agreements (FTA) – approval by member states and the European Parliament. Soon the UK will be able to determine its own policy. This paper suggests that there is enough untapped UK trade potential to offset the effects of Brexit on exports to the EU.
In this scenario, an ambitious, outward looking UK trade strategy could complement a deep and comprehensive deal with the EU and contribute to delivering increased UK prosperity. For this report Open Europe has developed a quantitative analysis to help inform the crucial decisions on trade and commercial policy. The framework will allow the UK Government to prioritise the non-EU trading relationships that the UK must seek to upgrade. It will show the implications that these developing relationships could have for improving the UK’s export performance. The gravity model, which we have used to build our framework, predicts how much trade the UK ‘ought’ to be doing with other countries based on various factors.
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