A new strategic narrative for British trade in turbulent times

This report is part of the British Academy's Economic Strategy Programme.

In an environment of international turbulence, the United Kingdom’s place in the world today and tomorrow will be meaningfully shaped by its response to the changing international order. When it comes to a new narrative to support the geopolitical context of Britain’s trading relationships, the UK has an opportunity to position itself as a dependable broker with strong relationships in the Global South, Europe and with the USA. This is not without challenges in the context of increased defence-spending, reduced development contributions and budgetary pressures. It will require clear, comprehensive and integrated policy responses.

Much of the UK’s current role in the world is rooted in its history. It has played an outsized role shaping the world via its historic empire, as both a founding member of leading international institutions and as a drafter of international law. The UK’s contemporary soft power has largely drawn on the constructed ‘specialness’ of the Anglo-American relationship, Anglophone cultural influence, and the UK’s influential role in the European Union. With each of these dimensions entering new and as yet unsettled incarnations, a new narrative of the UK today, and new strategies for global engagement are necessary. Such a new strategic narrative can guide work on securing prosperity and international influence for the UK based on a modern understanding of Britain’s place in the world and effective use of existing skill and knowledge-bases.

At present, the challenges to achieving this are threefold: emerging and escalating protectionism, the economic gravity which is drawing many countries into either alignment with the US-China geopolitical and economic rivalry or into new alignments, and reconfiguration of competitive advantage in emerging fields – in particular artificial intelligence and climate-smart technology.

The challenges before the UK also serve as opportunities. Whilst a return to competitive global blocs might serve as a traditional obstacle to UK global interests, shifting political alignments allow for special bilateral and multilateral relationships that will enable the UK to navigate these in innovative ways. Whilst the UK has a complex history and baggage with many emerging economies, its historical ties can still be leveraged in areas of shared interest conducted with mutual respect.

To increase influence and constancy for the UK in the more turbulent world economy, several impactful policy options might be considered and implemented.

The UK Government can develop stability in international organisations (IOs) which face turbulent times, nurturing a convening and brokerage role for the UK on specific topic areas, and leverage that legitimacy to influence relevant administrative and secretariat instruments.

Emerging bilateral and plurilateral coalitions of likeminded partners afford the UK a clear opportunity to cultivate a leadership role on trade, security, climate and development issues. The UK can offer select and deliberate support for non-aligned countries of economic interest while maintaining non-alignment in the geostrategic rivalry between the US and China. A new ‘special relationship’ between Europe and the UK as a country outside the EU can be defined on solid ground through shared values alongside security and economic interests.