To be a constructive player in a more divided world, the UK must rebuild its relationship with the EU, avoid being sidelined by closer US–EU cooperation, and ensure it pursues its trade and development agendas with strategic purpose.
The UK seems to have held its own internationally over the past year. The Johnson government has emphasized the UK’s role as a constructive player among the liberal democracies, especially in terms of its capacity to contribute to their collective security. However, its record on strengthening global resilience has been mixed. While the government engineered global progress to address climate change, severe aid cuts undermined its resilience agenda. It has started designing a more agile national regulatory framework in some priority sectors, and has initiated a more tailored set of trading relationships around the world, although the UK is unlikely to achieve many net positive economic benefits from its greater international economic autonomy.
Given these early indicators, how should the UK approach the next phase of its post-Brexit journey? When answering this question – the focus of this chapter – it is important to assess the international context in which the UK will operate in the next couple of years.
Four trends stand out. First, strategic and military confrontation with Russia over the status of Ukraine and the overall framework for European security is likely to dominate UK foreign and security policy thinking in the near future. This puts a more urgent premium on the UK and its EU neighbours setting aside the political divisions that defined much of their relationship in – and prior to – 2021. Doing so will also help ease the UK’s transition to a more balanced post-Brexit economic recovery.
Second, the crisis with Russia has strengthened the UK’s hand in its relationship with Washington. But the continued political polarization in the US – with pivotal congressional elections in November 2022 and positioning for the 2024 presidential election gaining salience in 2023 – means that the Biden administration will struggle to play a consistent leadership role in the new contest between democratic and autocratic systems of government, especially if it is forced to focus much of its limited foreign policy energy on crisis management with Russia over Ukraine, and on European security more broadly. The US will lean as much on the EU as on NATO in this context. The UK therefore also needs to sustain its role as a convener of the broader liberal democratic community – a ‘G7 Plus’ – and ensure it does not get squeezed to the margins by closer US–EU coordination.
Third, Russia’s invasion of Ukraine is leading to a more intense geo-economic and strategic contest between China and the US, and a more divided world. As a result, there will be continued dysfunction in the world’s multilateral institutions, and a search by many countries for more bespoke arrangements in their international relations. While negative for the world, this situation gives greater strategic purpose to the sorts of bilateral and regional trade deals that the UK has been seeking to develop. The same will apply to the UK’s efforts to contribute to global debates about standards and regulations, from trade to internet governance.
Fourth, in a less hierarchical world, where the global dominance of the largest democracies like the US and UK is challenged not just by China but by a host of other large and mid-sized countries, the UK’s international influence will depend on its ability to contribute to addressing problems that affect others as well as its own narrow national interests – simply put, finding global solutions to global problems. The UK has built up its soft power in part through its leadership on critical global concerns such as climate change, and supporting the social and economic development of more marginalized countries. The risk now is that Global Britain will become conflated in the eyes of others with a ‘Britain first’ outlook, if the government’s focus on responding to the crisis in Ukraine causes it to divert its attention and resources away from the UK’s commitments to supporting global resilience.
Rebuilding relations with the EU
The antagonism towards the EU that has characterized the political messaging of Conservative Party ministers since 2019 has been predictable and inevitable. It is difficult for Prime Minister Johnson to pivot towards a positive approach to the EU, having won his parliamentary majority on a bald commitment to ‘get Brexit done’ and given the deep level of mistrust with which he is viewed by his EU peers. He also needs to keep his base warm for the next general election, while proving that his bare-bones Brexit will have the cathartic effect on the country’s prospects that he had promised in the Leave campaign.
Nevertheless, at the start of 2022 the government gave the impression that it intended to set UK–EU relations on a more positive track. Following the resignation of the combative Lord Frost, responsibility for managing the UK’s relations with the EU has returned to the Foreign, Commonwealth and Development Office (FCDO). Foreign Secretary Liz Truss made a point of reaching out early in her tenure to European Commission Vice-President Maroš Šefčovič, while the government indicated that it would set aside for the time being its concerns over the involvement of the European Court of Justice in overseeing the implementation of the Northern Ireland Protocol. Compromises by the EU over the intensity of border checks on goods entering Northern Ireland from Great Britain has helped create the impression that this most toxic of issues could possibly be managed through technocratic solutions.
Certain EU member states seem to want to formalize a ‘cost’ of Brexit for the UK, even as they say they do not want to ‘punish’ Britain for its decision to leave.
Truss’s first speeches as foreign secretary made little if any reference to the EU as an institution. In her October 2021 speech to the Conservative Party conference, for instance, she instead referenced the Baltic Three and Visegrád Four as important European partners alongside a long list of non-European targets of Britain’s new, more commercially focused foreign policy.
Still, as the government was warned, the UK cannot escape the gravitational pull of the EU and is now trapped in an endless negotiation with its neighbouring trade bloc. Having negotiated the thinnest of all trade agreements, it is left with a TCA containing huge gaps – beyond those bedevilling the Northern Ireland Protocol – that need resolving in the coming months. Some issues are slowly being resolved, such as arrangements on fishing quotas and access to each other’s waters. But others remain unresolved, such as the EU’s refusal to grant the UK equivalence in certain areas of financial regulation and only temporary equivalence in others. UK small and medium-sized companies are struggling with added red tape as well as labour supply issues. They would benefit from a government focus on mutual recognition of professional qualifications, and short-term visas for workers to enter sectors such as hospitality, construction and manufacturing, as well as health and agriculture.
Other issues appear to be heading in the wrong direction. The unexplained exclusion of UK scientists and research institutions from research projects organized under the Horizon budget is a growing source of tension. The UK and the EU negotiated the UK’s inclusion, and the UK remains a key funder as well as contributor. As with financial services, certain member states seem to want to formalize a ‘cost’ of Brexit for Britain, even as they say they do not want to ‘punish’ the UK for its decision to leave.
Irrespective of political decision-making, 2022 could also see a worsening of the UK–EU trading relationship in goods for purely technical reasons. At the start of the year, the EU introduced the requirement for UK-based exporters to provide formal proof of the rules of origin of all components of their exports, rather than simply make a declaration to this effect. This has compounded the procedural burden for small and medium-sized businesses that were already dealing with the additional red tape of customs procedures to confirm that their exports meet EU regulatory and phytosanitary standards. And, from July 2022, the UK is scheduled to complete the introduction of its own border checks on most goods entering the UK from the EU.
It is also likely that regulatory competition and differentiation will increase. The appointment of Johnson’s close ally Jacob Rees-Mogg as minister for Brexit opportunities and government efficiency in January 2022 underscores the prime minister’s determination to point to a ‘Brexit dividend’ at the next general election. One example in this respect is general standards certification, where the UK government has stated that companies wanting to place goods in the UK market would need to meet a new UKCA (UK Conformity Assessed) safety standard, rather than sell under the established CE standard that applies throughout the European Economic Area. In practice, this could require businesses to comply with a set of standards that will mostly duplicate but in some places diverge from EU standards, and thus add greatly to the burden on companies that need to produce goods in line with two subtly different sets of standards for the two markets.
Continuing in an antagonistic trading relationship with the EU will be economically counterproductive, making the road to a post-pandemic recovery even steeper. The health of the UK economy and the job security of countless workers remains intertwined with those of the EU, given that, prior to Brexit, nearly 3 million jobs – 43 per cent of the 6.5 million UK jobs supported by exports – depended on exports to the EU, according to the government’s own data.
There is also the risk that allowing these areas of dispute and friction in the economic sphere to persist, and possibly fester, will undermine both sides’ desire to forge a closer relationship on foreign and security policy – as is now even more critical following Putin’s decision to rip up the post-Cold War security arrangements in Europe.
The UK government has argued that the two agendas can run in parallel, meaning that misalignment in one need not impact the other. Indeed, one of the features of the post-Brexit period has been continued close alignment between the UK and the EU on most of their foreign policy priorities, from coordination in support of the Joint Comprehensive Plan of Action on Iran (JCPOA) and the Paris Agreement during the Trump administration, to a growing approximation between the UK and its European neighbours on the relationship with China. This has convinced some in the UK that the government was right to eschew a formal treaty with the EU on foreign and security policy and rely instead on the ad hoc ‘E3’ process and bilateral coordination.
The high levels of coordination in response to the crisis with Russia over Ukraine could now serve as a powerful counterweight to the risks of spillovers from the tough UK–EU agenda into bilateral cooperation on foreign and security policy.
However, these unofficial formats cannot be entirely isolated from Brexit-induced tensions. The potential for UK–EU economic disagreements to cut across the desire for foreign policy coordination was evident in the run-up to the UK-hosted G7 Leaders’ Summit in 2021, as the French and German governments decried the Johnson government’s threat to trigger Article 16 of the Northern Ireland Protocol, and the Biden administration issued an unprecedented démarche warning of serious consequences should the UK act on this threat. This was a clear signal that a persistently antagonistic economic relationship with EU will likely weaken the UK’s international influence more broadly – not only in the G7 and the transatlantic relationship, but potentially also in other multilateral forums such as the G20.
The high levels of coordination in response to the crisis with Russia over Ukraine could now serve as a powerful counterweight to the risks of spillovers from the tough UK–EU agenda into bilateral cooperation on foreign and security policy. The UK, the US, Canada and the EU have closely aligned their diplomatic messaging, intelligence-sharing and execution of sanctions packages since the crisis began to escalate in November 2021. The EU’s idea of pursuing ‘European strategic autonomy’ as a hedge to an unreliable transatlantic relationship appears less attractive in many EU capitals for now. Moreover, following the invitation extended to Liz Truss, together with her US and Ukrainian counterparts, to attend the Council of EU Foreign Ministers, in early March 2022, there is an opportunity to create more frequent and more stable mechanisms for UK–EU foreign policy coordination, short of the sort of formal treaty that remains anathema to much of the Conservative Party, but that would regularize the recent close work and avoid the need for the two to reinvent these processes in the future.
One option is to explore how the parallel processes currently under way to develop a new NATO Strategic Concept and the EU’s Strategic Compass could embed the UK, alongside the US and Canada, in more regular transatlantic coordination across the full spectrum of responses that NATO and the EU together offer to confront challenges of shared interest to their members. The UK has been very supportive of Secretary General Jens Stoltenberg’s NATO 2030 agenda, which emphasizes the need for greater NATO focus on disruptive technologies, the increased importance of the cyberspace and space domains for conflict, and the dangers of hybrid threats. These priorities match the UK’s emphasis on the concept of integrated deterrence, giving UK and NATO forces the resilience to deal consistently against an adversary that operates below the threshold of war, together with its determination to be a lead nation on innovative science and technology.
The response to Russia’s invasion of Ukraine has also highlighted the way the EU’s own growing defence agenda – focused currently on joint funding for capacity and capability-building, supporting cyber defences and improving cross-border mobility – will be essential to an integrated European response to the Russian threat in the future. Although NATO and the EU have increased their levels of coordination and cooperation since the early 2000s – despite the impediments often imposed by Turkey over Cyprus – now is the time for the UK to support an acceleration of this process. The UK’s involvement in NATO’s first Innovation Fund and in hosting the future European headquarters of NATO’s new Defence Innovation Accelerator for the North Atlantic means it needs to find a regular framework to discuss issues of standards, regulation and interoperable technological solutions with the EU, given its competencies and funding sources in these domains. The risk otherwise is that the UK could find itself excluded from deeper defence industrial and technological cooperation within the EU, as the massive planned increase in German defence spending drives new initiatives in this sector.
A more specific UK–EU dialogue on security could also emerge from the
Russia–Ukraine crisis. It could include the establishment of a sanctions review group that would ensure alignment on the timing and targets of sanctions, as well as arrangements for lifting them. The contrast between the UK’s limited initial round of sanctions against Russian oligarchs close to President Putin, and the much more comprehensive package of US and EU sanctions imposed immediately after Putin recognized the breakaway regions of Luhansk and Donetsk on 23 February 2022, underscored the risks of relying on informal coordination, based on different legal frameworks.
Unless the UK government concentrates purposefully on leveraging the current close coordination with the EU over Russia’s invasion of Ukraine to cement this tentative improvement in relations, the weight and frictions of outstanding post-Brexit business could still open new divisions that would weaken both sides at a pivotal moment in international relations.
Reinforcing the transatlantic relationship with a G7 Plus
The Biden administration entered the White House committed to reconstituting the transatlantic relationship, as part of its effort to strengthen the US’s alliances around the world. The lead-up to and launch of Russia’s full-scale invasion of Ukraine enabled Biden to put this commitment into action. But the scale of the US administration’s foreign policy ambitions and demands, and its extremely challenging domestic agenda, means that US diplomacy will rarely be able to privilege the historically ‘special’ US relationship with the UK. Rather, there is the risk that the UK could get squeezed in the next couple of years by a closer US–EU relationship as well as a set of deals between the two that exclude the UK.
The response to Russia’s aggression against Ukraine has been good for the UK relationship with the Biden administration, given the government’s robust messaging to Russia and provision of defensive military support to Ukraine in the lead-up to the invasion. This followed a far more productive year of UK–US relations than had been expected, culminating in the publicity around the signing of the new Atlantic Charter just ahead of the June 2021 G7 Summit, and – less widely reported – the US decision to fund the new W93 high-yield warhead for submarine-launched ballistic missiles that is one of the foundations of the two countries’ special nuclear relationship.
But, as US Secretary of State Antony Blinken said at the Munich Security Conference in February 2022, the crisis has also shown the power of the US and the EU acting closely together. The US–EU relationship had already been on a positive trajectory prior to the Russian military build-up on Ukraine’s borders. Despite the Biden administration’s nervousness about upsetting US steel unions, in October 2021 US Trade Representative Katherine Tai converted the Trump-era US tariffs on EU steel and aluminium imports into less onerous tariff quotas. The same offer was not made to the UK, giving rise to much commentary that the delay was part of a not-so-subtle effort by the administration to push the UK into resolving its dispute with the EU over the Northern Ireland Protocol. The US action has had a severe impact on UK steel exports, as these are now being further undermined in the US market by cheaper imports from the EU. While negotiations to revoke the UK tariffs were completed in late March 2022, the preferential treatment extended to the EU should at the very least be a reminder to the Johnson government of the importance to the US of the EU’s economic weight, relative to the UK.
Importantly, the US–EU deal also included clauses to counter trans-shipment of Chinese steel via Europe to the US, with a reference to avoiding high-carbon-content steel from being part of the tariff-free quotas. Once the UK deal is completed with the US, it will follow rather than set this extraterritorial framework. The US focus on first striking a deal with the EU also reflects the delicate manoeuvring currently in progress between the world’s two largest markets over the roll-out of any carbon border taxes. Once again, the UK is a bystander to this US–EU debate regarding what will eventually constitute a radical and structural change to the global trading system.
Another critical area of US–EU coordination concerns the future of digital technology standards and regulation. In October 2021, US and EU negotiators met for the first time under the aegis of their new Trade and Technology Council (TTC). The TTC’s agenda covers the range of topics that are also central to the UK’s ambitions to be a science and technology superpower and home to some of the world’s most advanced companies. TTC working groups will try to find agreement on standards for new technologies such as facial recognition; on emerging technologies that could help combat climate change; on supply-chain security and data security; on export controls and investment security regimes; on global digital trade; and on governance of large tech companies. The EU’s long-standing role as the world’s most proactive regulator and self-appointed competition watchdog for the US’s giant technology companies, as well as its status currently as the world’s largest single market and regulatory space, makes the TTC a meeting
Once again, the UK is a bystander to a US–EU debate regarding what will eventually constitute a radical and structural change to the global trading system.
If the UK is to regain some diplomatic leverage, one route would be for it to try to join the TTC. The US might welcome UK participation on digital trade and security, as well as on standard-setting in general. The UK’s approach to tech regulation tends to be more liberal than that of the EU, and its status as Europe’s leading destination for tech investment would make it a natural ally to the US. In practice, however, this will be very difficult. Unlike defence and security, where the UK brings specific and weighty contributions to the success of a transatlantic agenda and has a commensurate voice at the table, on digital technology the UK risks becoming more of a rule-taker in the short term. This will remain the case unless the UK’s own tech sector achieves the sort of global scale and impact of the financial sector, at which point the government can then earn or fight its way to the front of the transatlantic debate.
What options does the UK have to increase its leverage in the meantime? The UK has rarely lived up to past claims to serve as a bridge across the Atlantic. The sensible option right now seems to be for the UK to work with the EU and the US bilaterally, and also with them jointly in the G7 and the emerging
NATO–EU formats on a case-by-case basis. But aiming for this sort of ‘mid-Atlantic’ strategy, trying to carve out space for itself whenever necessary in a US–EU–UK triangle, could leave it – and British companies – at a disadvantage generally, and stranded should the transatlantic relationship revert to the confrontational character seen under the Trump administration.
There is currently a very real risk that the Democrats could lose not just control of Congress and the legislative agenda in 2022, but also the presidential contest in 2024. If Donald Trump, or someone else with his ‘America First’ and anti-EU outlook, were to re-enter the White House, the UK would once again be under pressure to choose one side or the other as its preferred partner on a range of sensitive topics, from trade and regulation to foreign policy. In all cases, it would find itself in a junior role.
Given these dynamics, the strategy that would give the government the best chance to regain some measure of control over Britain’s place in the world would be to enlarge the UK’s circle of influence and help bring together a larger group of like-minded countries that also incorporates the US and the EU. This would mean the UK doubling down on its commitment to the G7 Plus, the grouping of states from the transatlantic and Indo-Pacific communities that Prime Minister Johnson convened during the UK’s G7 Presidency in 2020–21. The more cohesive this community becomes, in terms of its capacity for international economic and political coordination, the better the prospects for the liberal democratic agenda that lies at the core of the UK’s stated foreign policy; and the more resilient this community would be if the US does return to a more Trumpian approach to its international relations.
In this context, it has been promising to see Japan and South Korea immediately join Australia, alongside Canada, the EU, the UK and the US, in imposing sanctions on Russia following its invasion of Ukraine. Tokyo and Seoul have traditionally held back from joining these sorts of sanctions arrangements. Formalizing a G7 Plus process for coordinating, reviewing and improving sanctions policy would be a logical next step. Another way to give substance to this larger grouping would be to establish mechanisms to coordinate their international infrastructure investments through the UK’s BII, the EU’s Global Gateway, the Biden administration’s B3W programme and their Japanese, Australian and South Korean equivalents. Foreign Secretary Liz Truss recognized the logic of UK–EU cooperation to this end in her Chatham House speech in November 2021.
Another way would be for the UK to try to overcome the continued bilateral tensions with France over AUKUS, and coordinate implementation of its Indo-Pacific strategy along with France, Germany and the EU – all three of which have formally instituted their own Indo-Pacific strategies. Although this will be difficult, the US tilt back towards Europe given the crisis over Ukraine makes it all the more important that major European countries be seen to coordinate as well as sustain their own modest tilt to the Indo-Pacific. Given that China’s relations with Taiwan are likely to worsen over coming years, there is a premium on the UK and France – as permanent members of the UN Security Council and with important national commitments to the region – working more closely together on contingency planning. They could also coordinate their cooperation with Japan and Australia, both of which have toughened their diplomatic lines and military capabilities to confront the growing Chinese presence across the region. The fact that the new German coalition government led by Chancellor Olaf Scholz is likely to take a firmer line on China than Angela Merkel did would further support this broader coordination.
Rethinking the strategic purpose of UK trade policy
The need for a G7 Plus reflects the fact that the deepening division between liberal democracies and autocracies is making cooperation at the multilateral level ever harder. While this is a negative development in terms of addressing many global problems of common concern, it provides an opportunity for the government to pursue a more strategic international economic agenda than is implied in the Integrated Review. As already noted, the new bilateral trade deals being pursued by the government – beyond those it already enjoyed as a member of the EU – will have at best a marginal impact in the near-term on Britain’s prosperity. But they can deepen the UK’s political and geo-economic relations with countries and regions that could prove to be important partners in the larger strategic competition between Russia and China on the one hand, and the G7 Plus on the other. A similar purpose should animate the UK’s efforts to strengthen its voice in forums dedicated to designing the rules and standards of future global commerce and investment.
There would be no better example of this strategy than completing in 2022 the current negotiations for the UK to join the CPTPP. On the surface, joining the CPTPP sounds like the sort of trade deal that would demonstrate the benefits of the UK having an independent trade policy. It will give the UK tariff-free access for its manufactured products to a market of over 500 million people accounting collectively for over 13 per cent of world GDP. But, given the distances, even this significant regional deal is not expected to enlarge UK GDP by a meaningful amount, potentially by 0.08 per cent in the long run, similar to the deal with Australia. And, as with the Australia deal, the government will have to accept some similar trade-offs. It will make it harder for the UK to raise its own food and product standards in the future, without creating the risk that UK producers and manufacturers will be undercut by lower-standard imports from other CPTPP members. Similarly, the UK would be signing up to an ISDS system that could lead to companies suing the UK for regulations that harm their profits, even if these regulations are linked to other UK priorities, such as achieving a rapid energy transition away from fossil fuels.
But completing the deal for the UK to join the CPTPP will be an important symbol of the UK’s commitment to supporting an open, rules-based approach to economic relations in the Indo-Pacific, despite its distance from the UK market. This commitment will be all the more important at a time when it looks unlikely that the US will choose to rejoin this strategically important trade grouping of which it had been an original architect. And at a time when allied governments in the region will be concerned that the crisis in Ukraine will draw the UK’s strategic focus back to Europe.
The UK’s efforts to initiate and complete other new, advanced bilateral deals through 2022 should be seen in the same light. Planned deals with major economies such as Canada, Mexico and Turkey will deepen the UK’s relations with pivotal countries for the future – Canada being one of the UK’s closest partners on its recent sanctions policies, Mexico a key ‘swing’ member of the G20, and Turkey a critically important NATO ally. But even deals with growing emerging markets, such as Vietnam in the Indo-Pacific, and Egypt in the Middle East, could fit into the same strategy.
Critics can rightly question the UK prioritizing deals with these non-democracies at the same time as publicly promoting a ‘network of liberty’ as the core objective of its foreign policy. However, Liz Truss laid out the government’s thinking at Chatham House in late 2021, when she said that the UK, like other democracies, should be open to striking trade deals with countries that do not share its approach to domestic political governance, providing these countries are not trying to undermine liberal democracies, their shared institutions, or international law and order. She put China as well as Russia in the latter category of those undermining international law and order. Egypt and Vietnam, however, would not cross this threshold by this measure.
There are also some opportunities to pursue this strategy in the regulatory space. At the moment, the government is focused on changes that would sharpen its national competitiveness, such as those to listing rules and financial regulation proposed in the report by Lord Jonathan Hill. The government wants to attract new kinds of financial services from around the world and more fintech companies like Wise and Revolut into the City, in order to counter the growing competition from Amsterdam, as well as New York. The Kalifa Review of UK Fintech recommended that fintech forms an ‘integral part of UK trade policy’ and to create a new visa stream to enhance access to global talent for fintech scale-ups.
But the government should not think of regulation solely or principally as a space for buccaneering action and charting its own course. As noted above, this will be a risky option given the potential for the US and the EU to strike future transatlantic agreements in certain defined areas. Instead, British efforts to broker agreements to strengthen the resilience among the G7 Plus countries, in areas such as secure supply chains and cybersecurity, could include a regulatory and standard-setting dimension to which the UK would contribute.
And there are other areas where the UK can serve as a trusted source of international regulatory innovation. For example, the Kalifa Review proposed an action plan and taskforce to drive international collaboration on fintech through the newly created Centre for Finance, Innovation and Technology. In addition, the UK will find a diverse array of partners in its efforts to strengthen the digital agenda in the WTO. The UK is already one of the most vocal supporters of the WTO’s plans on e-commerce, which encompass several sensitive areas, such as the cross-border transfer of information, data localization, open internet access and cybersecurity.
Either the UK can try to undercut regional and global regulations to drive innovation, or it can try to lead global AI standard-setting in a direction that is consistent with the values and standards of the liberal democratic community; it cannot do both.
The government has also announced a new UK plan to shape global AI
standards. The UK could be a good broker of compromises and shaper of solutions that would lessen the risk of transatlantic division in this critical area. The UK has the benefit of hosting highly regarded institutions such as the Alan Turing Institute, and companies such as DeepMind, but is not an AI superpower whose regulatory leadership could be the gateway to global dominance, like China and the US. However, as Carly Kind of the Ada Lovelace Institute has warned, the UK needs to articulate its own regulatory approach soon, or it will end up having to harmonize with the EU’s emerging AI rules and fail in its ambition to be a science and technology superpower in this critical area. Either the UK can try to undercut regional and global regulations to drive innovation, or it can try to lead global AI standard-setting in a direction that is consistent with the values and standards of the liberal democratic community; it cannot do both.
The potential spillovers from Russia’s invasion of Ukraine only add to the strategic importance of the UK’s future trade and regulatory policies. One of the biggest conundrums in this context is India. India’s decision to abstain in the 25 February UN Security Council vote condemning the invasion served as an important reminder that other countries’ assessments of what constitutes a threat to international order will not neatly fit into the UK government’s own categories. Despite the well-known obstacles to negotiating a full-scale trade agreement with India, however, the UK could train its sights on a more targeted, sectoral trade deal that avoids overly sensitive areas for both sides, but whose completion would send an important signal to Russia and China of the deepening geo-economic ties among the world’s main democracies.
The challenges that this contested strategic environment poses to British foreign economic policy will likely intensify if there is no mediated solution in the near-term to Russia’s invasion of Ukraine and international sanctions continue or are further intensified. The growing number of US-, EU- and UK-imposed sanctions on China since 2021, alongside those applied to Russia, has brought China and Russia closer together, as demonstrated by Putin and Chinese President Xi Jinping’s joint declaration in early February 2022 that their countries’ support for each other would have ‘no limits’. With its current tacit support for Russia’s aggression against Ukraine, China appears to be standing by this agreement.
This raises the potential that the Biden administration will impose secondary sanctions against China if it provides support that would directly bolster Russia’s operations in Ukraine. It is uncertain whether the current transatlantic and transpacific cohesion among liberal democracies could be sustained in this case. The Chinese market will continue to be far more important to continental European countries as well as to allies such as Japan and South Korea than it is to the US. And very few countries beyond the core liberal democratic community – not just India, but the GCC states, key African partners like South Africa, or other G20 members like Brazil, Mexico and Turkey – will want to follow the US into a starkly divided world with its echoes of the Cold War era. Given the prospects of a more divided world, the UK would do well to undertake contingency planning among its G7 Plus partners for the risk of an escalation in the ways that economic measures will be used as tools of foreign and security policy, by allies and rivals alike.
Being a reliable global partner
In this less hierarchical global context, the government’s capacity to convene negotiations and broker and shape solutions consistent with the strategic objectives of the Integrated Review will depend on the country’s soft power as well as the government’s hard policies. The UK needs to rally other countries to its causes and interests; it cannot force them to engage by dint of its market, political or military power alone. To do this, the UK will need to serve as an attractive example and proponent of the sort of world it wants to bring about.
On the surface, the attractive power of the UK, or its soft power – an area in which the Integrated Review asserted that the UK is already a ‘superpower’ – appears to have held up in the context of Brexit. As shown in Table 1, the UK ranked third after Germany and Japan on Brand Finance’s Global Soft Power Index for 2021; and joint first with Italy in the British Council’s 2021 Global Perceptions Survey; whereas it was second to France on Portland’s Soft Power 30 Index in 2019.