Brexit frees the UK to work with China, Hong Kong to promote free trade, says Fox

Brexit will enable Britain to work with China and Hong Kong to promote global free trade as it will have more freedom to set its own trade rules, according to the UK’s trade minister.

Liam Fox, Secretary of State for International Trade, said that the British people’s vote to leave the European Union in a referendum last summer means the UK will enjoy closer trade ties with Hong Kong and mainland China.

“After Brexit, Britain is looking more outward from Europe. When we have the freedom to set rules outside of the restrictions of the EU, we will promote a more liberal global free trade agenda,” Fox told the South China Morning Post on Thursday.

The minister has spent the last two days in Hong Kong meeting with Chief Secretary Carrie Lam Cheng Yuet-ngor, Secretary for Financial Services and the Treasury Chan Ka-keung, executives of big British and Hong Kong businesses such as HSBC, BT, PCCW, Detroit Electric and Hong Kong technology investors.

“We are here to show Britain is open for business. We want to work with the Hong Kong government to deepen our investment and trade relationship in both directions between Britain and China and Hong Kong,” he said.

He said global trade had slowed in recent years to such a degree that its growth was now lower than the growth of global GDP. He said this was because many markets had introduced trade barriers including tighter regulations and compliance requirements which had stifled market access and the free flow of goods and services.

“Britain is very aggressively promoting global free trade. We strongly believe global free trade is the answer to many of our current problems and it would help many people get out of poverty,” he said.

US President-elect Donald Trump has vowed to impose greater restrictions on trade with China. Louis Tse Ming-kwong, a director of VC Brokerage, said any such restrictions imposed by the US would benefit trade between China and Britain.

“However, Brexit means Britain has lost its role as a gateway for Chinese investors to enter into the European market. Some Chinese firms may directly open offices in Paris, Frankfurt and other European countries instead of investing in Europe via their offices in London,” Tse said.

Fox said Britain would negotiate with the EU with the hope that it can keep maintain an open market after Brexit. “The negotiation has not yet started but we hope the EU will keep the market open,” Fox said.

Brexit negotiations between Britain and the EU will start in April and are expected to last for two years.

Edward Chow Kwong-fai, an adviser at the Business and Professionals Association of Hong Kong, agreed that Brexit would create closer trade ties between Britain and China.

“At present, Britain needs to follow EU regulations but after Brexit, it will be free and could negotiate new trade deals with China and other Asian countries. It would allow more flexibility for Britain to promote international trade,” Chow said.