Keeping up Appearances: What Now for UK Services Trade?

Summary:

The UK’s decision to leave the EU’s single market jeopardises its position as a hub for multinational services firms to sell to clients across Europe. Policy-makers in London should take steps to ensure that the slow trickle of business moving to the EU does not become a flood. The UK government should make a priority of creating and maintaining a stable and open policy environment so as to attract investment and people. The UK should avoid the temptation to make a show of diverging from inherited EU rules, so as to avoid further unnecessary regulatory instability. It should also re-engage with the EU on discussions about enhanced labour mobility, to ensure that services workers can move more easily between the UK and the Union.  As well as doing its best to retain services access to EU markets, the UK should also prioritise scrapping (or drastically reducing) visa application fees for all foreign workers, embedding provisions on the free flow of data in both the UK’s bilateral and multilateral arrangements, and engaging in longer-term formal and informal regulatory dialogue with regulators and politicians to improve access in target markets.

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