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S’pore a ‘natural’ free trade partner for post-Brexit UK

SINGAPORE — The United Kingdom will continue championing global free trade together with “natural partners” such as Singapore, said British Secretary of State for International Trade Liam Fox on Tuesday (Feb 21), as London readies itself for tough negotiations to exit the European Union (EU).

British Secretary of State for International Trade Liam Fox. Reuters file photo

British Secretary of State for International Trade Liam Fox. Reuters file photo

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SINGAPORE — The United Kingdom will continue championing global free trade together with “natural partners” such as Singapore, said British Secretary of State for International Trade Liam Fox on Tuesday (Feb 21), as London readies itself for tough negotiations to exit the European Union (EU).

In an interview, Dr Fox said that he has been receiving assurances from the UK’s international partners about trade cooperation even after it has exited the EU. 

“My first task (since being appointed last year) was to make the case for global free trade, and the case is very well understood here in Singapore,” he said.

He said Britain is looking at “natural partners” who believe in free trade, and Singapore is one of them. This is because the city state is “one of the most open markets in the world and one of the easiest places to do business”, he added.

Later in the day, Singapore and the UK renewed a bilateral Economic and Business Partnership (EBP) agreement. 

The agreement, signed by Dr Fox and Minister for Trade and Industry (Trade) Lim Hng Kiang, builds on an agreement signed in 2011. 

Under the new agreement, both sides will collaborate on trade policy capacity-building initiatives and establish a working group to deepen trade and investment ties, said a press release by the Ministry of Trade and Industry on Tuesday.

“The signing of the renewed EBP signals our joint commitment to strengthen bilateral economic relations. Against a backdrop of rising protectionist sentiments, Singapore and the UK as like-minded and forward-looking partners will stay the course on free and open trade. We will work together to promote the development of an open global trading environment,” said Mr Lim.

Last month, Prime Minister Lee Hsien Loong reportedly said Singapore would be ready to sign a free trade deal with the UK after it exits the EU.

Dr Fox, one of the key British ministers in charge of Brexit negotiations, said during the interview that the UK will be “focusing on the global picture and not be locked into the concept of blocs” going forward. He noted that there has been an increase in non-tariff barriers being introduced globally, largely by G20 and G7 countries.

“We need to work together because there is a chorus of protectionism, which is quite dangerous in terms of the health of the global economy.” 

Commenting on why Asians should continue investing in the UK, Dr Fox said the investment environment there has always been attractive.

“We have a legal system that gives people certainty and confidence in their investments. We have a skilled workforce. We have a low tax and low regulation economy … We have a strong research base. We speak English and we are in the right time zone for trading,” he said.

British Prime Minister Theresa May has said that she will invoke Article 50 of the Lisbon Treaty — the mechanism for leaving the bloc — by the end of next month. Britain has two years to negotiate a break-up deal once the Article has been invoked.

Looking ahead at the Brexit negotiations, Dr Fox said he expects Britain to have “some breathing space” during the meetings. “Europe has a very big trade surplus with the UK. Any tariffs that would be introduced (post-Brexit) would therefore do more damage to those countries which export to the UK, which you have to remember, is the world’s fifth biggest economy on its own,” he noted.

 

Catch CNA’s “Conversation With” on Thursday, March 2 at 8.30pm.

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