Trade Tuesday: A very gradual embrace - Switzerland and the UK's trade relationship
Last week, Business and Trade Secretary Kemi Badenoch travelled to Switzerland to launch negotiations on a new UK-Switzerland Free Trade Agreement. The current deal is more than 50 years old and does not cover services, investment, digital or data. Given this, Badenoch will be seeking to agree a modern free trade agreement fit for purpose and shore up support between UK and Swiss services industries.
After receiving criticism from sections of her party, following the government’s decision to retain some European Union (EU) Laws, this deal between the UK and Switzerland could serve as an opportunity to ease tensions with colleagues on the backbenches. However, more importantly, this deal could serve as an opportunity to further regain the confidence of businesses operating across the two countries.
Badenoch built on the former Prime Minister’s rhetoric, highlighting both nations’ services industries, whilst also emphasising how this deal could positively impact emerging scientific technologies. Regarding the pharmaceutical and scientific research industry, the government has been keen to emphasise that this deal could benefit more than 14,000 small and medium size pharmaceutical businesses in the UK. Claire Machin, Executive Director of the Association of the British Pharmaceutical Industry, highlighted the importance of this agreement and its impact on small businesses, suggesting it could be a driver in improving scientific research in both countries.
Away from the fanfare of supportive rhetoric, critics suggest that these talks will fail to act as a substantive replacement to the EU Horizon Europe project which the government is seeking to rejoin. Simon Usherwood, an international studies professor at the Open University, argued that it “is positive to see closer working cooperation between research and innovation communities [in the UK] & [Switzerland]. However, securing UK association to Horizon Europe remains our best outcome”. Therefore, even with the government recently announcing the Pioneer Prospectus, their alternative to Horizon Europe, and a renewed deal with Switzerland, it seems the ultimate prize for those in science industry will be the UK re-entering the EU’s Horizon scheme.
For Badenoch, she has successfully started talks for a trade deal and furthered her career as a Brexiteer deal maker. Nonetheless, outside of the internal politics of the Conservative Party, the UK is still defining its relationship with Europe as a whole, and without further clarity there will continue to be questions around the UK’s relationship with countries like Switzerland.