The UK government’s recently announced New Trade Strategy is an ambitious plan to protect UK businesses against the recent trade uncertainty and bolster the British export industry. 

The UK government’s recently announced New Trade Strategy is an ambitious plan to protect UK businesses against the recent trade uncertainty and bolster the British export industry. 

The plan includes an extra £20 billion for UKEF, the government-backed export finance and insurance provider, bringing its total capacity up to £80 billion. It will also establish the Ricardo fund, a body intended to tackle complex cross-border regulatory issues and remove obstacles for British companies doing business abroad, and expand cooperation with emerging countries on clean energy agreements. 

The UK has also announced it will join the Multi-Party Interim Appeal Arbitration Arrangement, an arbitration arrangement set up to resolve appeals to WTO disputes in the absence of a functioning WTO Appellate Board. This, along with the promised support of the Ricardo Fund, should make it easier for UK businesses to navigate foreign laws and international regulations, especially in a turbulent trade environment. The fund is named after David Ricardo, the 18th-century economist who first formulated the theory of comparative advantage and argued against international tariffs.

The New Trade Strategy is expected to strengthen British small businesses and fast-growing industries, such as the services sector, in the face of rising protectionism and foreign competition. It follows three trade deals with India, the US, and Europe, all geared towards giving UK businesses an edge over competitors and protecting domestic industries. It is being promoted as a “more agile and targeted approach” that will make the UK “the most connected nation in the world” by both opening it up to foreign trade and aggressively protecting domestic industries against unfair trade practices.

Prime Minister Keir Starmer said the plan was “a promise to British business: helping firms sell more, grow faster, and compete globally” and will “back British industry through global headwinds”. 

While the Strategy includes much-needed funding increases and ambitious plans to expand the UK’s capacity for trade, it remains to be seen how much of it can actually be actioned; the headline-making trade deal between the US and UK, for example, has yet to produce any tangible commitments from either side. 

The looming July 9th deadline, when the 90-day pause on US tariffs will run out, makes it all the more urgent for governments to strengthen their trade defences. The New Trade Strategy is a good first step, and shows a government aware of the importance of export finance and trade regulation to the national economy.