The Week Ahead in International Trade: EU leaders to consider non-tariff barriers and National Apprenticeship Week begins

A trio of political events looks likely to shape the news agenda for the week ahead, as Japan’s leader gains a new mandate while the UK’s government comes under further scrutiny. 

Elsewhere, a European meeting could result in reform of the EU’s internal trade barriers and we’re also celebrating the start of National Apprenticeship Week. 

UK uncertainty 

Firstly, in the UK there is continued speculation over the future of prime minister Sir Keir Starmer. Starmer’s chief of staff Morgan McSweeny resigned over the weekend due to the decision to appoint Lord Mandelson as ambassador to the US. Although McSweeney has stepped down, pressure is mounting on the prime minister’s own position ahead of a crucial by-election in Gorton and Denton. 

Pound sterling has dropped against the Euro because of the uncertainty. There are also concerns that more revelations about Mandelson could damage the UK government’s relationship with US President Donald Trump, who has also been named extensively in the ‘Epstein files’. 

Japan PM wins landslide  

Meanwhile, Japan is digesting a stunning landslide victory by incumbent prime minister Sanae Takaichi in yesterday’s snap election.  

Her Liberal Democratic Party (LDP) has won a two-thirds ‘super majority’ in the country’s House of Representatives and is projected to take 316 of 465 seats. Takaishi’s victory now gives her the chance to govern without support from opposition parties, and an opportunity to reshape Japan’s economy and foreign policy. 

Takaishi has promised tax cuts and talked up the benefits of a weak yen, calling it a major opportunity for exports. Japan’s first female PM has also been generally hawkish on China – resulting in eroding relations between Beijing and Tokyo. She has also signalled that she plans to reform the Japanese constitution, removing sections that restrict Japan’s military to ‘defence only’ operations. 

There was also an election in Portugal over the weekend, where centre-left candidate António José Seguro won comfortably over far-right candidate André Ventura to become the country’s next president, offering some comfort to Brussels as another nation votes against the Eurosceptic option.  

EU economic model in focus 

The EU is this week gearing up for another debate over its economic model, with papers seen by Politico suggesting Germany is preparing to argue against unnecessary bureaucratic burdens on industry. 

Ahead of Thursday’s (12 February) meeting of EU leaders in Belgium, German diplomats argued that trade barriers within the European Common Market effectively amounted to a 44% tariff for goods and 110% for services. European Council President, António Costa, has said he wants to use the meeting to agree to "deepen, harmonize and further integrate our Single Market." 

The Chartered Institute of Export & International Trade is holding a webinar tomorrow (10 February) on the EU’s plans for trade and customs. Global Trade Live will be covering some of the recent proposals on the Customs Union, de minimis and the Carbon Border Adjustment Mechanism (CBAM). 

The head of the European Payments Initiative (EPI) banking alliance, Martina Weimert, also pushed for Europe to end its reliance on US services like Visa and Mastercard, warning that this market dominance represents a weak point if transatlantic relations continue to deteriorate. 

“We are highly dependent on international [payment] solutions,” Weimert told the FT. 

National Apprenticeship Week 

Today also marks the start of National Apprenticeship Week – a week-long celebration acknowledging the positive impact that apprenticeships make to the UK economy, including the role they play in equipping the UK’s future workforce with the skills to thrive. 

It’s a good opportunity for employers to explore some of the funded training opportunities on offer.