A modern economy with international businesses, whether selling goods or services, is reliant on data as much as on people. Within this, digital trade has gained increased importance, whether in terms of electronic delivery of international services, or the innovations in various areas from financial services to cars with increasingly sophisticated computers.

The ability for the UK to reach its own trade agreements has been seen by many as a key benefit of Brexit. After replicating trade agreements with countries with whom the UK had trade deals by virtue of our EU membership, an ‘Agreement in Principle’ had at the time of this meeting been announced with Australia.

The UK’s cultural and creative sectors are rarely considered when trade deals are discussed, despite significant and diverse exports from computer games to music, theatre to fashion. Such neglect has led to problems, most notably in the hugely increased difficulties UK cultural and creative workers now face in touring or working around Europe. 

Questions relating to trade in animal products attract far greater attention than their economic value would suggest. Concerns about human and animal health, the ability of countries to produce their own safe and cost-effective food, and fair competition among others mean Import checks are typically more onerous and tariffs higher. In the case of UK trade relations this has meant concern about reduced exports to the EU or increased imports of lower quality from the US, a potential shortage of vets, and interest in whether a UK-EU veterinary agreement could help.

This meeting considered the impact of changing UK trade arrangements specifically on Small and Medium Enterprises (SMEs) across the country. There was a global concern that smaller companies find modern trade barriers disproportionately hard to overcome, and anecdotally it seemed that smaller UK exporters had been particularly badly hit by the changes to trade relations with the EU since January 2021, which could have had an particularly bad influence on some regions of the UK.

This meeting considered the short and long-term impact of the Trade and Cooperation Agreement on the UK’s financial services sector. Witnesses were asked to outline the nature of UK trade in financial services, the impact of barriers to trade with the EU, and opportunities available elsewhere. Whilst the supporting professional services environment in London was referenced it was not the main focus of this session. The intention was rather to focus on the detail of the financial services sector, the nature of the change from member to third country, how this affects UK trade, and what practical steps can be taken with the EU and other markets to strengthen the UK.

Globally the food and drink sector is typically most affected by trade barriers, with both the highest levels of tariffs and the most onerous non-tariff barriers (typically sanitary and phytosanitary or SPS measures). It was therefore unsurprising that this sector has been at the centre of stories about the impact of the changes to UK trade from January 1 2021. The change was particularly abrupt for movements from Great Britain to the EU and Northern Ireland, the latter due to the provisions of the Northern Ireland protocol.

This meeting considered the likely short and long term economic impacts of the change in UK-EU trade relationship from membership of a customs union and single market, to the Trade and Cooperation Agreement. Witnesses were asked to comment on the immediate impacts and longer term prospects for UK-EU trade, including integration within cross-European supply chains, and whether the effects on trade with the EU will be compensated for by greater trade with the rest of the world.

Commission Members meet to agree Terms of Reference for the Commission and set priorities for its inquiries. This inaugural session is private and not available to view.