The US president’s tour of Asia continues today with a trade deal apparently signed with South Korea. Tomorrow’s meeting with Chinese president Xi Jinping could be an even more significant occasion for global trade, however.
Closer to home, the UK is facing a smaller role in global trade since its departure from the EU, according to the World Trade Organization (WTO).
WTO flags Brexit hit to UK trade
The UK’s share of global trade has declined since it left the EU, according to the WTO.
In a new ‘Trade Policy Review’ report on the UK, the WTO said the departure had “led to a permanent increase in trade costs for UK businesses”, primarily because of “new border checks and requirements compared with EU membership”.
These changes, it argues, have been most significant for small businesses, whose exports to the bloc have dropped by 30%.
Investment as a proportion of GDP is also “well below other advanced economies”, the report says, with investment “dampened by uncertainty over UK-EU relations” as well as domestic “structural barriers”. These include “weak competition, low business dynamism, financing bottlenecks and other constraints to scaling up”.
The WTO also singled out the “high industrial electricity costs” businesses face in the UK as a challenge.
“Realising trade's full potential” in the UK requires “additional efforts to cut trade costs”, the report concludes, as well as efforts to “tackle broader constraints on productivity and investment that weigh on economic growth”.
Mercosur about that?
The EU could finally be set to put ink to paper on its trade deal with the Mercosur grouping of Latin American nations, according to a report in Politico. Talks have been ongoing between the two parties for 25 years.
While German leader Friedrich Merz said at a summit of EU leaders last week that the deal was “unanimously agreed”, European Council president Antonio Costa said member states had only agreed to take talks forward.
A new date has been floated for inking the deal, however, in 20 December. On this day, it has been suggested European Commission president Ursula von der Leyen could visit Brazil to formally sign off on the agreement.
On 18-19 December, EU leaders are expected to hold a final summit on the subject. It remains to be seen whether the major holdout on the deal, France, will agree. Only this week, French farmers have issued a letter to President Emmanuel Macron urging him to reject the deal.
Trump to ease China tariffs
US President Donald Trump has said that he will cut the US’ current tariff on Chinese goods by 20%, the portion of the rate that he implemented in response to what he has argued is China’s role in the illegal fentanyl trade in the US.
“I expect to be lowering that because I believe they can help us with the fentanyl situation,” he told reporters yesterday. “We have to get rid of it”.
Trump has also said today at a press conference that he has agreed a trade deal with South Korea. He is currently in the country as part of his tour of Asia, ahead of a visit to China to meet Chinese president Xi Jinping tomorrow.
UK-Swiss agreement extension
The UK has agreed to extend an agreement with Switzerland that allows professionals to travel to Switzerland to provide services without a visa for up to 90 days each year. They are also not required to secure a work permit under the terms.
The extension means the deal now runs through to 2029. Swiss professionals are also able to work in the UK according to the terms.
The government states that the deal “supports broader trade in vital industries of the UK economy, including finance, consultancy, legal services, the tech sector and the creative industries”.
Also today (29 October), the government has issued an update on negotiations with Switzerland over an enhanced trade deal. It said that talks have now concluded on “competition”, with a next, ninth round of talks set for early 2026.
What else is in the news
· Copper prices have hit a record high as tariffs heap challenge on an industry also grappling with production problems
· AI-related layoffs are accelerating globally, according to Reuters analysis
· The Netherlands goes to the polls today – we have a full preview of how the election could play out here
· The UK government claims that chancellor Rachel Reeves has unlocked £6.4bn in “two-way trade and investment deals with Saudi Arabia” during a visit to the Gulf region this week
Yesterday in trade
· Japan struck a new critical minerals deal with the US
· Russian oil giant Rosneft announced it was selling its international holdings in response to US sanctions
· UK chancellor Rachel Reeves said she expects a trade deal with the Gulf Cooperation Council soon
You can read it all here.
