Free Societies

Making the most out of Brexit: how the Institute of Economic Affairs reshaped British trade

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In June 2016, the British public voted to leave the European Union (EU). Since then, the Institute of Economic Affairs (IEA) has been at the forefront of making the intellectual case for the United Kingdom (UK) to adopt a comprehensive free trade agreement with the EU, as well as expounding the wider benefits of global free trade.

The result of the Institute’s work has been startling. “It has probably been the IEA’s greatest (and toughest) policy win in over a decade,” explained IEA’s Alex Lee. “Not only has the U.K. government publicly pledged that the country will be a ‘leading champion of global free trade,’ but it has followed through on that pledge, already securing trade deals worth £885 billion with 63 countries and the European Union, with more promised on the horizon.” That figure would account for nearly one-third of the entire GDP of the United Kingdom.

To tackle this massive and controversial issue, IEA rolled out a four-year plan that boiled down to three key elements: 1) academic research with the “Plan A+” paper at the centerpiece; 2) tutorials and in-person briefings to educate those with influence on the levels of power; and 3) a public education campaign consisting of articles, podcasts, films, and a nine-city speaking tour of the United States, hosted by Atlas Network and several Atlas Network partners.

“Plan A+” was published in September 2018 by Shanker Singham and Radomir Tylecote, and provided a roadmap for British leaders wishing to implement the referendum decision successfully. “The opportunity before the U.K., as a result of Brexit, is a great one,” the report says. “But if the U.K. squanders it, what has been described as the ‘new normal’ of limited economic growth could prevail, and an EU system that does not appear to be responding on a competitive level to the challenges of the modern economy.” Plan A+ lays out four fundamental pillars of prosperity that should be a priority in post-Brexit discussions:

  1. Unilateral: a commerce treaty that a nation imposes without regard to others (such as eliminating all tariffs and quotas)
  2. Bilateral: an agreement between parties or states that aims to keep trade deficits to a minimum (such as the Australia Free Trade Agreement)
  3. Plurilateral: an agreement between more than two countries with the option to agree to updated rules on a voluntary basis (such as the Trans-Pacific Partnership)
  4. Multilateral: a commerce treaty between multiple countries (such as the United States-Canada-Mexico Agreement)

By focusing on these four pillars, Singham and Tylecote argue that the U.K. has the opportunity to create genuine Economic Partnership Agreements that could revitalize the British economy.

Shortly after Plan A+ was launched, the IEA offices were burgled. Unfortunately, and although a link could not be proven, this wouldn’t be the last time IEA would be targeted for this work. In November, the Charity Commission wrote a letter to IEA trustees advising them of its intention to issue an Official Warning for the Plan A+ publication and launch. The Commission also instructed IEA to implement a new Trustee sign-off process for future publications and launch plans, and provide written assurance of future compliance. Despite IEA’s compliance, the Commission issued an Official Warning in February 2019, which IEA promptly challenged, highlighting several missteps and clear bias within the Commission. The IEA also surrendered the copyright to the plan, so that others might publish what the British state tried to ban.

In July, the Charity Commission withdrew the warning—the first time an Official Warning has ever been rescinded—and the IEA reported the Commission to the Information Commissioner’s Offices (ICO) on the grounds of blocking efforts to investigate the cause of the dispute, including specious claims, public complaints, and breaches of due process, leading ICO to launch an investigation. Furthermore, the Charity Commission had to be pursued for a further eight months before agreeing to remove all references to the improper sanction from their website.

With the government bureaucracy finally out of IEA’s way, the team republished Plan A+ and resumed accompanying events, comments, and articles.

In February 2020, Prime Minister Boris Johnson hosted a press conference, with IEA’s Mark Littlewood, Shanker Singham, and Radomir Tylecote in attendance, about the U.K.’s post-Brexit future. “We have the opportunity, we have the newly recaptured powers, we know where we want to go, and that is out into the world,” said Prime Minister Johnson from his purple podium in Greenwich. “We are embarked now on a great voyage, a project that no one thought in the international community that this country would have the guts to undertake, but if we are brave and if we truly commit to the logic of our mission—open, outward-looking, generous, welcoming, engaged with the world championing global free trade now when global free trade needs a global champion—I believe we can make a huge success of this venture.”

Prime Minister Johnson’s press conference represented a complete shift in the country’s outlook on international trade, and put to rest the fear of many free-market “remainers” that Brexit would lead to a rise in protectionist policies. A couple of months later, in May 2020, the Prime Minister’s office released its post-Brexit approach to a trade deal with the EU, which fully encapsulated IEA’s Plan A+.

The IEA team continued to host discussions and keep the conversation alive, and jointly launched the “Global Coalition for Free Trade” along with fellow Atlas Network partner, Americans for Tax Reform Foundation. The coalition brought together free-trade-oriented think tanks in the United States, United Kingdom, and the EU, as well as from Latin America and Africa.

The U.K. continued to secure trade deals with prominent world economies during the last month of 2020, including Canada, Kenya, Singapore, Vietnam, Switzerland, Norway, and Iceland all in one week. On Christmas Eve, the U.K. and EU agreed to a post-Brexit trade deal, which emulates (almost to a tee) the proposed deal in Plan A+.

The British government implemented all four pillars of IEA’s Plan A+, and the results speak for themselves. The U.K. projects that the 63 trade deals that Plan A+ and IEA helped usher through are worth about £885bn, equal to almost one-third of the British GDP.

As we discussed in a 2019 article, Brexit has divided the liberty movement ever since the referendum. While some saw Brexit as an opportunity to shed a layer of international bureaucracy, some saw it as the beginning of the road to nationalism and protectionism. Despite the challenges and frivolous investigations aimed at silencing its voice, IEA has totally reshaped how the U.K. views international trade.

“Brexit was always both a risk and an opportunity for Britain,” concluded Littlewood, director general of the IEA. “A once-in-a-generation opportunity for the UK to strike out into the world and renew our free trade credentials, or alternatively falling back into the protectionist orbit of the EU. While much of the British political class and commentariat focused only on the relationship between the UK and the EU, we pushed for the British Government to see the EU negotiations as only a part of a greater strategy.”

Atlas Network supported this initiative with a grant.