The UK international trade secretary Liz Truss will meet executives from some of the world’s largest tech firms on her visit to the US this week. The move to court Big Tech is aimed at driving investment into post-Brexit Britain, but could also be the precursor for a closer relationship between the UK public sector and the tech giants.
The UK is touting itself to the tech giants as a leading investment destination. (Photo by Willy Barton / Shutterstock)
Truss met with US Trade Representative Katherine Tai at the start of the five-day trip to discuss “closer cooperation on tackling threats to free and fair global trade”. According to a department of international trade statement, she was then due to “travel to the West Coast, home to some of the world’s biggest tech companies, to promote the UK as a leading investment destination ahead of the Global Investment Summit in October.”
Foreign direct investment (FDI) worth a net £14.6bn flowed into the UK from the US in 2019, making it the biggest single contributor to UK FDI. Attracting more investment from the tech sector can help grow this relationship, and the prize on offer for the tech companies could be a bigger role in the provision of public sector services.
The UK and Big Tech: geopolitics matters
Geopolitics is also an important factor in the relationship between the UK and Big Tech, according to Abishur Prakash from advisory firm the Centre for Innovating the Future. "I think this trip is about communicating that the UK wants to be a technology leader, but also about communicating certain boundaries about how the government wants Big Tech to operate in the UK," he says. "They don't just want them coming in and acquiring UK companies, like Google did with Deepmind, and funnelling all the talent and innovation back to the US. The UK wants to benefit, too."
Prakash says wielding influence with big US tech firms is also important for medium-sized countries like the UK when it comes to preserving technological sovereignty. "Governments around the world are waking up to the fact that if they don't take action on technology they will end being defined by what the US or China does," he says.
For the tech firms themselves, Prakash adds it is important to keep governments such as the UK on side, as lawmakers are becoming bolder when it comes to taking action. He cites the examples of Twitter's struggles in India, where it is in dispute with the government over its legal status, and Nigeria, where the social networking site has been banned outright. "The era where these companies can transcend national borders is over – they can no longer afford to do what they like and ignore local laws," he says. "The UK is a large economy with an important role in the world so I think they're going to listen to whatever requests the government has."
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What will the UK's future relationship with Big Tech look like?
The UK has set out plans for stock market reform in a bid to make London a more attractive destination for tech firms. "Encouraging more Big Tech firms to either to set up business or list their shares in the UK is certainly a major post-Brexit government objective," says Professor Marc Moore, chair in corporate/financial law at UCL's faculty of law. But, he says, while the stock market reforms "might make existing UK-based tech firms like Darktrace and Deliveroo more likely to seek financing in London, it is highly unlikely that we will see an influx of US-based Big Tech firms to our shores" because the volume of capital available in the UK does not stack up when compared to the US.
Rather than simply trying to persuade tech companies to move to the UK, Sam Gilbert, researcher at the Bennett Institute for Public Policy at the University of Cambridge, says the government may be seeking a different, and potentially mutually beneficial, relationship with Big Tech. "It's interesting that Liz Truss's agenda also includes a meeting with California governor Gavin Newsom's team," Gilbert says. "Newsom has proposed a 'data dividend' where Californian citizens would receive a share of tech companies' profits."
Big Tech's tax arrangements have been in the spotlight in recent months, and companies such as Amazon, Google and Facebook could find themselves paying more tax under plans to set a minimum global level of corporation tax, which have been backed by finance ministers from the G20 countries. Gilbert argues the UK might go one step further. "Perhaps the broader objective is a different sort of settlement with the big tech companies, in which they play a bigger role in enabling the government's data-driven agenda, but are also expected to be more democratically accountable and pay more tax," he says.
Gilbert adds that the UK government appears to be more open to collaboration with Big Tech than the European Union, even if this is at the expense of the privacy rights of citizens. He says this is reflected in the job specification for the new Information Commissioner, due to be appointed later this year, which puts a strong emphasis on being able to use data as a national strategic asset. "Compared to the EU, the UK government seems more interested in realizing the potential of public-purpose data analytics, and somewhat less concerned with enhancing individual privacy rights," Gilbert says. "However, that won't necessarily mean an easy ride [for Big Tech] in regulatory terms, as there is also an emphasis on making tech companies take more responsibility for preventing online harms and promoting online safety."
