UK trade 'much to gain' from Swiss approach following EU exit


The UK could follow the example of Switzerland and strike trade deals around the world if it left the European Union, a think tank has claimed.

A Civitas report said the UK could have a "successful independent free trade policy" after an exit from the EU but there would be "risks as well as opportunities".

The study examined Switzerland's ability to secure international agreements without being a member of the EU and suggested that the UK could strike "serious deals" with greater ease if it severed ties with Brussels.

In a detailed case study of Switzerland's 2009 trade agreement with Japan, Civitas research fellow Jonathan Lindsell said the Swiss won lower tariffs for key exports like cheese, watches, chocolate and cereal, plus better access for services.

The report claimed the size of the EU meant deals were harder to strike, because countries were worried about the impact on their own industries of a trade agreement with the 28-member bloc.

It pointed out that, unlike Switzerland, the EU had not yet managed to secure a deal with Japan.

The report said: "UK trade would have much to gain if Britain took a similar approach to Switzerland, whose achievement has been considerable given Japan's historically protectionist approach, especially over food.

"Moreover, the EU has failed to conclude any sort of free trade agreement with Japan.

"Many possible trade partners are intimidated by the EU's great size, which could be a threat to their domestic industries.

"This can delay or halt EU negotiations, which are anyway slowed by competing internal demands.

"Britain alone would not be such a threat or suffer such internal division, but would still be an attractive market."

The report added: "By representing itself rather than being one of 28 jostling partners, Britain could focus on winning tariff concessions for its own goods and granting them where the government considers appropriate. 

"Independent control of trade policy would also give Britain more options to use trade as a diplomatic tool."

But the report noted that securing new deals around the world could take some time after an exit from the EU, with the Switzerland-Japan agreement taking six years to conclude.

The economic benefits of EU membership have been a contentious issue ahead of the in/out referendum promised by David Cameron before the end of 2017.

"If Britain voted to leave the EU in 2016 or 2017 the country would face new challenges as it regained full responsibility for representing itself on the world stage," the report said.

"It would not automatically win all the trade deals our exporters would like, or win them as swiftly as might be hoped.

"The Swiss example suggests, though, that a committed negotiating team from a country much smaller than Britain can make its mark on global trade.

"By constructing policy on the Swiss example, Britain can be confident that serious talks would yield serious deals."