Lord Flight is Chairman of Flight & Partners Recovery Fund, and is a former Shadow Chief Secretary to the Treasury.
The country voted for Brexit because a majority was fed up with being told what to do, and with never-ending rules and regulations from an unaccountable EU bureaucracy. We felt we could “paddle our own canoe” as the fifth or sixth largest economy (depending on what exchange rate you take).
It is, however, time for voters to be more enthused about the post-Brexit opportunities for this country: America, Canada, Australia, India and New Zealand and a host of other countries are keen to gear up and trade much more with the UK, outside EU constraints. For our part, while getting rid of tariffs is the most positive action to boost trade, we also need to be looking at practical measures. Any Chinese businessman will tell you it is still a time-consuming hassle to get a short-term visa to visit the UK for business trading purposes.
China has short-term business visas and visa-free transit, which may be obtained quickly; we should introduce the same for Chinese and businessmen from other countries, who are serious about wanting to do more business with Britain. China and the USA have mutual ten-year visas. For the United Kingdom, the competitive imperative is evident. Interestingly, Hong Kong and Dubai allow short term visits without the requirement of any visa: we should consider permitting such short-term transit entry for citizens of the countries with major increased trade potential. We need to be clear that Brexit is about opening doors and not about xenophobia. I am not suggesting a more liberal immigration policy overall: rather, I am a proponent of easing red tape and making it clear to the world that Britain is open for business in a competitive manner.
We are living in times of powerful new technologies, in which Britain is particularly well placed to benefit. Our industries are world-leading – from financial services to advanced manufacturing and life sciences. We are one of the best places in the world to start and grow a business. New businesses and employment have been at record levels over the last three years.
Over the last 15 years, the proportion of British exports going to the EU has virtually halved to around 30 per cent-35 per cent when, correctly, transhipments via Holland are excluded. The GDP of the Commonwealth has outstripped that of the EU. Britain should be immensely grateful to the Queen for her major part in keeping the former alive in more difficult times. Today we have countries looking to join it. In addition to fostering a major increase in trade, helped by getting rid of tariffs, I see growing scope for the City of London to increase substantially the range of financial services that it provides to Commonwealth economies.
The EU, meanwhile, is likely to face economic and financial crises as a result of adopting the Euro for political purposes, given Germany’s refusal to support the less competitive EU economic areas with transfer payments. Italy and much of Southern Europe have seen little or no economic growth since 2000. To share a currency successfully requires the participating economies to be similar, or, if this is not the case, for the less competitive economies need to be sustained by transfer payments from the more successful. Yet Germany refuses to consider transfer payments.
I understand the Government’s keenness to achieve a free trade agreement with the EU, but we need to be careful that the price is not too high, and that such an agreement does not limit our scope to increase our trade with the rest of the world, as we see fit. Europe is, already, relatively, a shrinking market for us. We also need to avoid being shackled with over expensive and over demanding EU regulations which will drive business elsewhere – I cite here, as an example, MiFID II.
When our referendum result was declared, I judged that the negotiations with the EU would boil down to being about how much the EU could extract from us for facilitating some form of ongoing free trade deal (also helpful to the EU): and that the EU tactic would be to be difficult and unpleasant until the very end, before offering us an unattractive deal at the last minute in the hope that will be frightened into accepting this.
I hope that the Government realises that, to get a fair and sensible deal, it is implicit that we will need to be prepared to walk out and function under the WTO. This would be far more damaging to the EU than to the UK, given the EU’s current account surplus with the UK of circa £100 billion per assum; and thus likely to encourage a more sensible EU offer. We must also avoid overpaying for questionable trading benefits.
My sympathies go to those politicians and civil servants with the task of negotiating with rude and unhelpful EU officials. The Government needs to set out the very positive trade and economic opportunities post Brexit and, particularly, with the huge English speaking parts of the world. My vision is for Britain to become a successful, low tax, global economy, attracting entrepreneurs and traders from all over the world.