Business

Britain hopes Commonwealth summit will lead to Brexit boost

AFP-JIJI

Britain is hoping this week’s Commonwealth summit will lead to increased trade with its historic network as it prepares to quit the European Union under Brexit.

The U.K. has seized on analysis showing the advantages of trade between Commonwealth countries due to its common language and legal systems. But some quarters are warning that Britain’s trade with Commonwealth nations lags so far behind that with its European Union neighbors that a straight substitute is impossible.

The 53 member states are gathering for their biennial Commonwealth Heads of Government Meeting (CHOGM), being hosted this year in London.

Born out of the former British empire, the voluntary organization focuses on development and democracy but is turning its attention toward boosting trade.

Intra-Commonwealth trade is expected to increase by at least 17 percent to around $700 billion by 2020, according to the 2018 Commonwealth Trade Review.

“Brexit will have wide-ranging economic implications for the U.K., the EU and many Commonwealth members,” the report says.

“However, there may also be important opportunities for the U.K. in the post-Brexit period to … negotiate new bilateral trade agreements with interested Commonwealth members.”

Britain is expected to go for the hard sell during CHOGM. The summit proper is on Thursday and Friday but kicked off Monday with three days of forums and events that lay the groundwork.

Britain’s International Trade Secretary Liam Fox on Monday chaired a session on catalyzing growth and championing free and fairer trade.

Meanwhile Britain is hosting a reception aimed at showcasing British exports, from food and drink to the English Premier League soccer trophy.

“You’ve got some of the fastest-growing economies in the world. It will be a great opportunity for us to rebuild old friendships,” British Foreign Secretary Boris Johnson told BBC television.

“A lot of that is going to be on the table at the Commonwealth summit,” he said Sunday.

When Britain joined the European Economic Community in 1973, it sidelined historic trading links with its former empire, causing much hurt in some countries.

Britain is due to leave the EU in March 2019. A transition period runs until the end of 2020 after which the U.K. will be out of the European single market and customs union.

Britain is gearing up to strike its own trade deals outside the single market, and is looking to its former global network.

The Economist magazine said Saturday that the Commonwealth “won’t save Britain from Brexit,” calling the idea that Commonwealth trade could replace EU trade “an amiable delusion.”

In terms of goods and services trade in 2016, Britain does more business with 15 countries — nine of them in the EU — before its biggest Commonwealth trade partners Canada and India.

Overall, the EU accounts for nearly half of Britain’s trade; the Commonwealth accounts for a tenth.

Philip Murphy, director of the Institute of Commonwealth Studies, wrote in The Guardian newspaper: “Sorry, Brexiters. Banking on the Commonwealth is a joke.

“The notion that it can pick up the slack when the U.K. leaves the EU is nonsense.”

But given its highly diverse membership, agreements struck within the Commonwealth are likely to achieve wider support.

At the last Commonwealth summit in Malta in November 2015, leaders struck a deal on climate change that paved the way for the Paris agreement days afterwards.

The theme this time is “Towards a Common Future.” The group is hoping to agree on an ocean governance charter, a connectivity agenda for trade and investment, and a declaration on tackling cybercrime.

“CHOGM 2018 promises to deliver transformational change for the people of the Commonwealth,” said the organization’s Secretary-General Patricia Scotland.

“Immediate impact combined with wider influence make the Commonwealth an unparalleled force for building understanding and cooperation toward realizing global goals for social and political progress, inclusive prosperity, and sustainable development.”

The summit comes immediately after the 2018 quadrennial Commonwealth Games in Australia’s Gold Coast.

Britain last hosted CHOGM in 1997 and plans to do so in style.

Queen Elizabeth II, the Head of the Commonwealth, is hosting a dinner for the leaders at Buckingham Palace. On Friday they gather in private at Windsor Castle, west of London.