In 1962 the then US Secretary of State Dean Acheson famously commented that the UK had ‘lost an Empire and not yet found a role’. EU membership appeared to have created that role – as the US/EU hinge US. But Brexit brings that period to an end, forcing the UK to once again define its role.
Part of the UK’s answer to the question of what it should play is ‘Global Britain.’ Easily derided as an empty political slogan, it is intended as a statement of intent that, far from the departure of the UK from the EU being a moment at which the UK turned inwards and became more insular, Brexit will see the UK re-double its engagement with the wider world community beyond the EU.
Giving substance to that intention, the UK will publish its long-awaited “Integrated Review” on 16 March 2021. Billed as ‘the largest review of its kind since the Cold War’ it is designed to reset the UK’s foreign and defence policy priorities in a world outside the EU, where the comfortable post-Cold War consensus appears to be breaking down.
The UK government is, understandably, keen to demonstrate that the UK’s EU departure signals a major foreign policy shift. But, with public finances under severe post-Covid pressure; the IR likely to confirm a further significant Armed Forces cut; and a new public sector wage and investment freeze on the horizon, too much ambition could see the UK spread itself too thinly across the globe.
There is an urgency to fleshing out ‘Global Britain’. Trade volumes with the EU have dropped noticeably already this year. To prosper outside the EU, the UK will need to build dynamic commercial relationships with new partners. Those new relationships will entail difficult decisions about prioritization of limited resources. And wherever the UK looks, it will find well-ensconced competitors.
The UK’s renewed interest in Africa is evident from the four new trade deals it has already signed in 2021 and its ambition to be the largest G7 investor in the Continent by 2022. But that ambition will be juxtaposed with the UK’s recent significant foreign aid reduction, and the reality that China’s investment in Africa is currently more than four times that of the UK (France invests twice as much). The UK’s new focus on Asia/Pacific will bring an overstretched (and possibly under-resourced) UK into closer contact with China – with whom tensions are already simmering. Attempts to deepen relations in the Middle East, will risk running into a resurgent Russia.
The UK and China
The UK stance on China is closer to the US position than the EU’s. The UK, which has become increasingly vocal in criticizing China over Hong Kong, Tibet and Xinjiang, will have noted, with some satisfaction, the Biden Administration’s irritation with the EU for pushing through the Comprehensive Agreement on Investment with China days before his inauguration.
UK attitudes towards China have been hardening for some time. The UK public views China with distrust and its global rise with unease. Large sectors of society in the UK blamce China for the Covid-19 pandemic. Members of the Houses of Parliament have been increasingly strident in criticizing China, pushing the Government to include genocide provisions in its Trade Bill. The UK has revoked CGTN’s broadcasting licence; will convert the G7 into a D10 to counter-balance Chinese influence; and is sending its new aircraft carrier into the S. China Seas on its first overseas deployment.
China is unavoidable for the UK – its fourth largest trading partner; increasingly dominant in Africa; and the major economic power in a region where the UK’s Trade Deal with Japan and its application to join the CPTPP signal concrete determination to increase its presence. The UK’s China policy will have to strike a very delicate balance between criticism of China over human rights and the need for a stable bilateral and trading relationship.
The UK and Russia
Russia has played its hand well on the global scene. Opportunism in the Middle East has forced the ‘traditional’ players to pay attention. Pandemic diplomacy has resulted in exports of its highly effective vaccine to Africa. Its increasingly close relationship with China and Turkey and its sidelining of the EU, signal a burgeoning confidence.
But the UK’s relationship with Russia has been increasingly difficult for a decade and a half. Although Russia is the UK’s 21st largest trading partner, both sides agree the bilateral relationship is now ‘essentially frozen.’ The poisoning of Alexander Litvinenko in London in 2006 was a clear inflection point and the downwards trend in the bilateral relationship can be charted through the Russian invasion of the Crimea; allegations of interference in the 2016 Brexit referendum; and the Salisbury poisoning in 2018. The UK will need to work out how to handle Russian adventurism in the Middle East and its growing presence in Africa.
Human Rights and Sanctions
In his speech to the UN Human Rights Council, the UK Foreign Secretary stated ‘the promotion and protection of human rights [is] at the very top of [the UK’s] list of international priorities’ – highlighting abuses in Russia, Myanmar, Belarus and China. In coordinating with Canada in imposing sanctions on Myanmar and designing a Magnitsky sanctions regime which differs (apparently intentionally) from the EU’s system, the UK is underlining that its departure from the EU will lead to a different emphasis on human rights.
Whilst commendable, placing human rights at the top of a foreign policy agenda carries risks and may make for uncomfortable bilateral relations. Turkey and Egypt, for example, are both important strategic and commercial partners for the UK, which will have to decide how to balance its emphasis on human rights against the need for increased trade. The 26 February 2021 US report naming Muhammed Bin Salman as having approved the murder of Jamal Khashogggi and placing sanctions on 76 Saudi officials highlights another difficult example. The UK, with its significant Saudi trade links, has not yet responded to the US report.
The UK’s new role in the world outside the EU will inevitably be partly constrained by pre-existing relationships and its economic, political and military limitations. The UK will continue to: look to the USA for security; trade extensively with the EU – as third country trade deals will not compensate for existing EU trade; and balance its bilateral tensions with Russia and China with its economic and commercial relationships with them. And too much hostility towards the EU could leave the UK trailing in the wake of a revitalized US/EU partnership – especially on climate change.
As the UK looks to define its place and move away from the EU, its traditional geopolitical relationships could be prone to rapid shifts of direction. Trade Deals will continue to open new markets; and the UK will no longer be held back in dealing with third countries by the need to find common positions with its EU partners. That may mean the UK finds its voice on human rights or corruption issues in South America and Asia as it asserts its support of the rules-based international system.
These changes may be unsettling for investors and will almost certainly create new risks. But they will also create genuine new opportunities for companies. Covington’s team of international relations and public policy experts looks forward to working with clients to help navigate these choppy international relations waters.