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January 12, 2021

UK aims to be ‘technology hub’ for global economy

Trade secretary Liz Truss says technology will be at the heart of the UK's post-Brexit trade agreements. But can 'Global Britain' be a technology leader?

By Laurie Clarke

The UK will position itself as a ‘global services and technology hub’ at the heart of the global economy, secretary of state for international trade Liz Truss said this week, in a speech outlining the government’s post-Brexit trade strategy.

Her speech indicated that technology-related concerns such as privacy and intellectual property protection will be central to the UK’s post-Brexit trade agreements. We will promote modern rules that are relevant to people’s lives for digital and data trade,” she said. “We will also build an advanced network of trade deals, from the Americas to the Indo-Pacific, with the UK at its heart as a global services and technology hub.”

UK technology hub

Technology concerns will be central to the UK’s post-Brexit trade agreements. (Photo by Leon Neal/Getty Images)

For example, the UK is working on an ‘enhanced trade partnership’ with India “reflecting our mutual interest in technology and innovation,” Truss said. And it aims to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, which Truss praised for “its ambitious digital and data provisions and clear rules”.

And although Truss did not mention China by name, she took the opportunity to condemn unfair trade practices, including forced technology transfers, of which the Asian superpower is often accused.

Global broker

This vision of the UK as a trade negotiator and rules-setter chimes with the recommendations of a report published by global policy think tank Chatham House on the same day as Truss’s speech.

The report, entitled Global Britain, global broker, advised that, instead of trying to reincarnate itself as a “miniature great power”, UK should style itself a “broker of solutions to global challenges”.

Global challenges that the UK could influence include “protecting liberal democracy; promoting international peace and security; tackling climate change; enabling greater global health resilience; championing global tax transparency and equitable economic growth; and defending cyberspace,” the report says. It can do this by leveraging its soft power, economic and financial strengths, and membership of the world’s most important multilateral organisations.

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In particular, it calls on the UK to take a prominent role in defending cyberspace. The US and the EU have knocked heads on cyber standards, including over privacy and regulation. This creates an opportunity for the UK to broker an “alliance of democracies, committed to defending the integrity of each party’s cyber domains while ensuring enhanced digital rights for citizens”.

The report also calls for the UK to negotiate its own bilateral trade agreement with China, as the EU and China did in the final days of 2020.  It advises that “there should be limits on Chinese investment in strategic UK economic sectors: not just in communications infrastructure, but also in the acquisition of high-tech start-ups”.

The geopolitics of technology

In the past decade, access to technology innovation has become a matter of growing geopolitical tension. There has been some concern among Western countries that if China pulls ahead in areas such as communications and AI, then it will cement the technology standards that shape the global economy and gain a security advantage.

Last year, UK prime minister Boris Johnson proposed greater collaboration among members of the Five Eyes intelligence-sharing alliance (comprising the UK, US, Australia, Canada, New Zealand) on research and technology development, with the addition of Japan to widen the tech talent pool. The idea for a group of democracies, the ‘D10’, that would initially focus on developing alternative 5G technologies and other forms of high-tech collaboration, was also mooted.

But the Chatham House report criticises these ideas, saying that both risk appearing both exclusionary and arbitrary. “Why not include Finland and Sweden, home to two of the three main non-Chinese companies competing with Huawei and other Chinese firms in the roll-out of 5G technology?” the report asks. 

Instead, the report proposes that the UK work more closely with the G7 and other like-minded countries in a more fluid, less formal, alliance. This reflects a hope in some countries that once president-elect Joe Biden enters the White House, the UK can help the G7 recover a prominent role in developing common global economic and foreign policy positions among member countries.

But ultimately, the UK will have to strive to stay relevant in terms of technological ambition. “Lacking the clout of the US or China, nor able to leverage that of the EU, the UK will need to work hard to insert itself at the nexus of the contentious debates on how to regulate and govern the new frontier areas of international affairs, such as artificial intelligence, biotechnology, cyber governance and outer space,” the Chatham House report concludes.

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