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Background

This regional policy forum was convened by the Centre for Inclusive Trade Policy (CITP). The event was held under Chatham House Rules on 22 January 2025.

The aim of this forum was to create an opportunity for open dialogue between policymakers, civil society, and academics to take stock of the UK internal market and external trade policy. Given the regional focus of the event, establishing a discussion on the implications of these trade policies for Wales was central to the event’s objectives.

As part of a commitment to inclusive trade, the CITP is committed to regional policy fora and developing an understanding of the UK nations and regions’ perspectives on trade policy. This inclusion is of particular importance in the current international trade policy context, as many non-tariff barriers and trade policies, such as food safety and labelling or animal welfare, are managed and created at the devolved government level.

Overview of the CITP Trade Policy Forum – Wales

Co-hosted by the Wales Governance Centre, the CITP Regional Policy Forum sought to gain an understanding of the views and perspectives of government officials, academics, civil society, and other stakeholders representing the interests and experiences of Welsh voices. This forum explored the challenges and opportunities facing Wales regarding UK internal trade and external trade agreements. To help facilitate a vibrant and varied discussion, the event was split into two sessions.

Panel One: Trade and inclusivity – A view from stakeholders

Participants painted a clear picture that the real and potential impact of engagement in trade policy has been difficult for civil society and small and medium enterprises. They see clear challenges to their involvement in UK trade policy formation, notably access to the relevant UK institutions given the ‘ownership’ of trade as a reserved competence. Some of these challenges include barriers to accessing relevant Westminster departments, sharing of information, and participating in key meetings. Together, structural challenges remain for the full inclusion of Welsh stakeholders in the UK trade policy process.

Panel Two: The role of devolved administrations in trade and opportunities for inclusion

A clear takeaway from the discussion is that since the election of a new government in Westminster, the governments in Cardiff and London are getting along more constructively, and there are positive efforts to engage with the devolved membership through intergovernmental relations fora. However, like in the first session, the ‘grey’ ownership of trade policy (and its many components) and the lack of a clear UK trade policy (at least to begin with) inhibit the ability to engage fully and effectively on the matter. Further challenges related to data access mean that understanding the Welsh trade landscape clearly is intricate impacting data analysis and identifying trade priorities.

Challenges and opportunities for UK-Welsh Government inter-governmental relations (IGR)

Discussants noted that the current trends in global trade commitments overlap with multiple devolved competencies or have effects on devolved governments’ abilities to implement their mandates. As such, this transversal nature of contemporary trade policies (covering areas adjacent to trade) means that the sub-policies addressed can be devolved, reserved, or both. This mixed nature of trade has led to ‘grey’ ownership of trade policy. Efforts to support greater involvement and input by the devolved governments in UK trade policymaking should be undertaken to make the lines of responsibility and action clearer.

Following the change in the UK Government administration, it was noted that relations between the devolved and central governments have been enhanced. Many factors have played a role in improving the intergovernmental relations between the UK and devolved governments including the reformed IGR and enhanced document and information sharing, in addition to the value of ongoing engagements and time spent working constructively together. These positive efforts to support effective IGR have led to government officials in Cardiff and London working more constructively on trade policy issues which were noted to have benefitted the trade policy process.

Challenges and opportunities for Welsh non-governmental groups

One of the most pressing challenges discussed was the lack of financial resources knowledge, and labour capacities for non-governmental groups when approaching the area of trade policy. Many of the non-government groups at the event expressed on the topic of capacity, many organisations have part-time or voluntary staff, restrictive budgets, and/or a lack of organisational capacity and knowledge that would otherwise permit them to meaningfully and effectively engage with trade policy discussions. Despite civil society, small and medium enterprises, and micro-enterprises constituting a considerable proportion of the Welsh economy – and considering that they are directly impacted by trade policies created at each level of government – there remain barriers to their engagement in policymaking. This fact has not been lost on these organisations or the governments responsible for policy consultations in attendance.

Despite these ongoing capacity issues, participants at the forum highlighted their positive engagements with local and devolved governments in fostering open consultation practices. To that end, there was a sense that while devolved governments are willing to engage with non-government stakeholders, barriers to accessing central UK institutions remain for civil society in devolved nations. Paired with the challenges faced by the devolved government in accessing the trade policy space, given the policy’s ‘grey’ ownership, the distance between the UK’s central government and devolved non-state actors was felt to be extended and distant. It was noted that efforts to engage the devolved administrations more fruitfully in the trade policymaking process could naturally lead to the voices of Welsh civil society also gaining a seat at the table.

Geopolitics and values

Several participants crucially spoke about what made Wales ‘special’ or ‘unique’. Additionally, it was noted that the Welsh trade policy ‘vision’ is values-informed, drawing heavily from the Well-Being of Future Generations Act (2015). Having the Welsh perspective represented during the negotiation and implementation of UK trade agreements with third countries would enable a better trade policy to be made in the name of the UK, rather than England et al. Doing so would ensure that the values and priorities of devolved governments are heard, and if justified, included in the UK’s approach to trade policy and future agreements.

Within the post-Brexit context, there have been significant changes in the ways and means that devolved governments, including the Welsh civil service and Senedd, communicate with their UK Government counterparts. These changes have impacts. As mentioned above, the fuzzy ownership of trade is among the most important issues that are contributing to regionally felt differences.

One key challenge raised related to accessing the data needed to understand the economic and trade environment of the devolved nations. For example, the collection of Welsh trade data by central institutions, but restrictions on the disaggregation, collection, and dissemination of this data have resulted in the devolved institutions being unable to fully comprehend their domestic trading environment. Actors at the devolved level, therefore, have at times found it difficult to make informed trade policy decisions, develop cooperative strategies, or resolve gaps in trade and services data. With the Welsh and other devolved governments adopting a greater role in informing trade policy, there is a clear need for timely, region-specific, sector-specific data in order to analyse the situation and set priorities. Unfortunately, despite recognition of this need, there continues to be data constraints and a lack of clear sharing practices between the central and devolved/Welsh governments. Clearer lines of communication and data sharing across the nations of the UK were noted to likely contribute to positive policy outcomes in this regard.

Finally, participants echoed near-universal support for increased accountability mechanisms in UK-devolved nation IGR. Following the review of IGR (2022), there appears to have been a growth in the sharing of documents between the two governments. However, there is room for improvements, particularly regarding when documents are shared, and the ‘fullness’ of these communications in terms of their relevance and detail.

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1. Managing grey policy areas: While many matters are clearly defined within the devolution acts as sole or shared, devolved or retained competencies, many policy areas remain unclear. Recognising these ambiguous/grey/fuzzy policy jurisdictions through supportive IGR mechanisms and the inclusion of the voices of people, governments, and other stakeholders when affected by policy decisions would improve the representativeness and inclusivity of policies made.

2. Capacity development: Limited knowledge, time, and funds have created a trade policy capacity deficit for many SMEs, micro-enterprises, civil society groups, and under-represented groups in the UK. Developing programmes to support trade literacy would help develop productive discussions and consultations as all participants would be able to provide informed feedback to decision makers.

3. Inclusion of SMEs and voluntary sectors: A sizeable proportion of the UK and Welsh economies are comprised of SMEs, micro-economies and the voluntary sector, many of whom are directly impacted by inclusive trade policy ambitions and obligations. More needs to be done to ensure that these groups have the opportunities and capacity to inform the government on trade policymaking through meaningful consultation and outreach efforts.

4. Values-informed trade policies: It is important to keep hold of what makes a devolved nation or region special and their culture and values are integral to that composition. Incorporating and utilising the strengths of the nations and regions can help foster a UK-wide approach to international trade as well as honour the interests of each local community.

5. Data development and sharing: all governments are better off when decisions are based on timely and accurate data. Improving the data shared, especially disaggregated data would improve trade policymaking and support the UK and local economies.

Conclusions

The open and honest discussion at this regional policy forum brought forward diverse voices from civil society groups, government, and academia. These actors identified the key and complex challenges facing Welsh populations and particularly underrepresented groups (e.g., SMEs, the voluntary sector, etc.). While participants identified progress made towards consultation and outreach, both between the Welsh government and local populations and between the UK and Welsh government, more work is needed. Recognising the importance of values, differences, and national/regional dimensions of trade with access to disaggregated data, trade policy capacity development and improved stakeholder developments (especially where grey policies exist) will help governments, businesses, consumers, and civil society groups make better and more informed choices.

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