As Britain leaves the EU, many are placing hopes on the Commonwealth, the post-colonial club of countries, as an alternative trading partner for a new “Global Britain”. Can it work? Alex Rankine reports.
What’s happened?
Heads of government from 46 of the Commonwealth’s 53 member states met last week in London. This is the first Commonwealth Heads of Government Meeting (known as a “CHOGM”) since 2015 and the first held in the UK since 1997. As host the UK government set the agenda, which notably included agreement that Prince Charles will succeed Queen Elizabeth II as head of the organisation. Discussions about boosting intra-Commonwealth trade also featured prominently, part of Theresa May’s plans to build a post-Brexit “Global Britain”.
Is the Commonwealth important?
On paper the post-colonial club makes for a formidable grouping, comprising a third of the world’s population (2.4 billion people), one-fifth of its land mass and fast-growing emerging markets. Many Commonwealth countries also share the English language, similar systems of government (the Queen is still head of state in 16 “Commonwealth realms”) and draw on shared legal traditions. Yet the organisation cannot enforce agreements and major members such as India are reluctant to take a leading role. It is not a trading bloc, and critics point out that high-flown talk of shared “Commonwealth values” is undermined by the presence of plenty of authoritarian leaders and the fact that homosexuality remains illegal in some 37 Commonwealth states. Its agenda is also limited because CHOGMs only take place once every two years. By contrast, EU leaders have gathered together on five separate occasions in the past year alone.
How strong are Commonwealth links?
Not as strong as they used to be. Before 1973 Britain offered preferential tariffs in a system known as “Commonwealth preference”, but this was scrapped to pursue more lucrative opportunities in the European Economic Community (as the EU was then called). Prior to 1971 Commonwealth citizens could also move freely to the UK to live and work. A relic of the old policy can still be seen in the fact that UK-resident Commonwealth citizens can vote in general elections and stand for parliament (a right not extended to EU citizens living in Britain). Yet these arrangements are not widely reciprocated – last year a clutch of MPs were thrown out of the Australian parliament after being found to possess dual nationalities, including those of other Commonwealth states. News of the Home Office’s treatment of the Caribbean “Windrush generation” broke just before the London CHOGM, further souring sentiment.
What is “Global Britain”?
Ministers have been keen to emphasise that Brexit will not, in Theresa May’s words, cut Britain off from the world. UK exports to the Commonwealth rose 120% between 2001 and 2011 and the grouping collectively accounts for 14% of global GDP. The UK remains the organisation’s largest economy, closely followed by India, then Canada, Australia and Nigeria. The club’s fast-growing populations and markets have given succour to some Brexiteers, with Ukip MEP James Carver waxing lyrical that post-Brexit “the world is our oyster, and the Commonwealth remains that precious pearl within”.
Can it work?
There are real opportunities in the Commonwealth, but they are best seen as a complement rather than alternative to EU trade. The UK exports five times as many goods and services to the EU as it does to the Commonwealth. Countries tend to trade most heavily with their neighbours – Britain does more business with little but nearby Belgium than with India and Canada combined. Likewise, Canadian trade policy is naturally focused on the US, while Australia and New Zealand look to growing opportunities in east Asia. Moreover, the bulk of the Commonwealth’s population remains extremely poor, with a GDP per capita of just $4,446. There are also doubts about the government’s commitment to the idea. Select Committee MPs complained in March that “Global Britain” is little more than an “advertising slogan”.
What about trade deals?
International trade secretary Liam Fox hopes Commonwealth states will be especially amenable to trade deals once the Brexit transition period ends in 2020. New Zealand PM Jacinda Ardern has confirmed that her country should be one of the “first cabs off the rank” to nab an agreement; Australia, Canada and India are other key targets. Downing Street said last week it had signed £1bn of commercial deals with visiting Indian PM Narendra Modi. Fast growing economies in Malaysia, Bangladesh and Nigeria could also spell opportunities for UK trade negotiators and exporters in coming decades, notes Gemma Tetlow in the FT.
So plain sailing ahead then?
Perhaps not. Agriculture and growing protectionism pose challenges, but the biggest hurdle will be immigration. Trade relations with India have been overshadowed for years by the British government’s refusal to loosen visa restrictions for skilled Indian workers, while further rule-tightening during May’s tenure at the Home Office also alienated other Commonwealth governments. Indian officials have made it clear that a new tack on visas is a prerequisite for a trade deal, but this conflicts with the government’s stated desire to reduce net migration to below 100,000 per year. Britain’s economy is in “urgent need of skilled workers”, says Anna Isaac in The Daily Telegraph. “Solving the UK’s attitudinal problem to migrants” will be “crucial as it develops a new independent immigration policy”.