The Week in International Trade: Conservative Party Conference wraps up

Fri 6 Oct 2023
Posted by: Danielle Keen
Features

Coffee cups and newspaper on table

What did the Conservative Party Conference have to offer on trade? Not a lot, in truth. Both business and trade secretary, Kemi Badenoch and prime minister Rishi Sunak touted the success of Brexit, in the form of accession to CPTPP. A sentiment almost echoed by Andrew Bailey, who gave an optimistic long-term forecast of the UK’s economic prospects this week, saying departure from the EU had created “big opportunities”.

The big picture: Following some doom-mongering about the state of geopolitics at the WTO Public Forum last month, the organisation doubled down on its negativity with pronouncements that global trade is set to be half of previous projections, coming in at a meagre 0.8% growth this year.

A bright spot among the gloom were growth forecasts for India and South Asia, which the World Bank released this week. Chief economist for South Asia, Franziska Ohnsorge, told the FT that despite ambitious development targets, the region’s demographic advantage granted by a young population gives it “lots of room for catch-up”.

Good week/bad week:  It’s been a good week for Labour. Ahead of its own party conference, the people of Rutherglen and Hamilton West delivered Labour a strong by-election victory, as reported in the BBC. New MP Michael Shanks received more than double the vote of second-place SNP candidate Katy Loudon, with a 20% swing to Labour. Given that the rise of the SNP decimated a previously reliable Scottish Labour vote, this result has been taken by some as a promising portent of things to come in the forthcoming general election.

It's been a less than great week for Metro Bank, which is trying to plug a £600m hole in its balance sheet. What’s the strategy, you ask? Imploring customers not to start a run on the bank. The Independent reports that the Prudential Regulation Authority said it would stop the bank from offering mortgages using its current internal risk model, leading to a drop in share value.

How’s stat? Beleaguered Chinese property giant Evergrande’s share prices initially jumped 40% when its stock resumed trading in Hong Kong on Tuesday, the Guardian reports. Only time will tell if this will be enough to stop creditors circling the company.

The week in customs: The next phase of the Windsor framework was rolled out this week, ushering in new red and green lanes, designed to minimise checks and increase efficiency. As businesses get up to speed with a raft of new legislation, all eyes are on Stormont to see if the new framework will be enough to encourage the DUP back into the power-sharing arrangement.

Quote of the week: “The world economy has shown remarkable resilience, and the first half of 2023 has brought some good news, largely because of stronger-than expected demand for services and tangible progress in the fight against inflation.” A surprisingly optimistic assessment of global trade from IMF chief Kristalina Georgieva, speaking at the annual World Bank and IMF Meetings in Marrakesh this week, as reported in the FT.

What else we covered this week: Executive editor, William Barns-Graham, captured the key insights from the Institute of Export and International Trade’s (IOE&IT) Border Target Operating Model (BTOM) webinar.

Richard Cree brought you an overview of the IOE&IT-sponsored Spectator panel, at the Conservative Party Conference event, which featured business and trade minister Nusrat Ghani and policy exchange fellow Lord Frost.

Phil Adnett lifted the lid on a key component of the green transition with a deep dive into nickel for his Commodity in Focus series. While Benjamin Roche analysed the key takeaways from an LSE study that made the case for firms experiencing productivity gains when they start exporting.

True facts: Space fly-tipping is now a crime of sorts, the BBC reports. The US Federal Communications Commission handed a fine of £125,000 to Dish Network for failing to remove its space junk from operational satellites. Something for space agencies, private firms and space-hungry tech billionaires to think about.