UK trade policy through a global lens

In late 2025, we published a comprehensive analysis of the UK’s trade policy landscape: UK Trade Policy: An Independent Review. We encourage interested readers to look at the full report for more detail. Each chapter, listed below, can be read independently, with both an executive summary and key recommendations provided.

• Ch.1: UK trade and economic performance
• Ch.2: What do we know about UK trade policy
• Ch.3: Domestic dimensions of UK trade policy
• Ch.4: International dimensions of UK trade policy
• Ch.5: Trade and economic security
• Ch.6: Trade and the digital transformation
• Ch.7: Trade and sustainability
• Ch.8: Trade, employment and gender

In this series of blogs, we summarise each chapter. The third blog in this series 'UK trade policy: Domestic framework and accountability' summarised the domestic architecture enabling trade policymaking in the UK. This blog summarises the key elements of the UK’s international engagement in trade policy.

UK external engagement in trade policy takes place:

a) Multilaterally at the World Trade Organization

b) The UK’s trade agreements reveal how differentiated engagement with trading partners reflects the UK’s strategic policy objectives.

Multilateral positioning

Historically the UK has been a long-standing support of the rules based international trading system since its inception, and through to the establishment of the WTO in 1995. In particular, the UK has engaged actively in negotiations on the E-Commerce Joint Statement Initiative and the Joint Statement Initiative on Services Domestic Regulation; as well as on the ongoing discussions on the relationship between trade, environment and sustainability, trade and gender and women’s economic empowerment.

However, the current rules-based system is under some pressure – in part from the lack of significant progress in negotiations since 1995, including on some of the issues above, and in part from emerging challenges. These include climate change, environmental sustainability and the digital transformation, and more recently economic security and the emergent challenges to core principles of the WTO relating to the most favoured nation principle and reciprocity. The UK is actively involved in those ongoing discussion on WTO reform. The ‘pragmatic trade policy’ approach mentioned in the Trade Strategy (2025) also seems to mean supporting adherence to WTO trade rules ,while still recognising the lack of multilateral progress in WTO reform.

Reform to tariff schedules has allowed for more trade on a non-preferential basis

Exiting from the EU required the UK to define its independent tariff schedule. The UK Global Tariff (UKGT) and came into effect on 1 January 2021. The UKGT increased the share of duty-free tariff lines from 52% (as an EU member), to around 70%. Nearly 66% of the UK’s tariff lines were modified to some extent. The reductions were largest in construction materials, food products and chemical products, and appeared to reflect a desire to reduce or simplify tariffs on intermediate goods. Over 20% of trade is with countries (notably China and the US) that the UK trades with on Most Favoured Nation (MFN) terms.

Gaps remain despite numerous trade agreements ranging from FTAs to mini-deals

Following the decision to leave the EU, the UK signed a number of Free Trade Agreements (FTAs). Of these, 34 were ‘roll-over’ or continuity agreements covering over 100 countries or territories, and 7 are new free trade agreements. Government assessments estimate that the five most liberalising FTAs would raise UK GSDP by 0.39%.

These agreements focus primarily on improvements in market access through tariffs, with more minimal reductions in non-tariff barriers. There is broad consensus that many agreements were signed primarily as a means of strategic alignment and policy signalling. The UK-Australia agreement drew heavy criticism for being rushed to demonstrate the UK’s ability to sign agreements despite specific areas of concern remaining on liberalisation of tariffs on agricultural products, weak parliamentary scrutiny and lack of engagement with the devolved administrations. The CPTPP is another example where uncertainties remain around gains from accession.

Stakeholders from our consultations also raised concerns that FTAs could undercut UK farmers due to lower standards abroad, and possibly lead to an impact on the standards used in the UK. This may be more likely if there is a lack of dispute settlement, where we see that the Sanitary and Phytosanitary (SPS) chapter is subject to dispute settlement in only two agreements (UK-EU and CPTPP).

Another concern was the need for ‘deep integration’ of services into trade agreements, particularly the TCA where the UK has strengths in services exports. The rise in the use of imported services as inputs for exporting activity, and the joint bundling of goods and services exports for the UK underlines the importance of treating trade policy with regard to goods and trade and with regard to services trade jointly.

The EU-UK Trade and Cooperation Agreement (TCA) is a good example of an agreement which focussed primarily on tariffs with regard to market access issues and dealt only lightly with services trade. The TCA also introduced new layers of administrative requirements which were further exacerbated by the EU’s application of third-country customs to goods imported from Great Britain.

Finally, the 2025 UK-US Economic Prosperity Deal (EPD), is considered a “handshake” rather than a contract due to the absence of any enforcement mechanism in the agreement.

In addition, the UK has also signed other agreements, which we call ‘mini deals’ that focus on specific areas of policy impacting trade, ranging from investment, transport, customs procedures, and access to critical minerals. Our analysis identified around 170 such deals, of which 62 fall directly into the category of trade, including the 2025 Economic Prosperity Deal with the US. The EPD represents a significant departure from traditional approaches to FTAs because of its narrow focus, because it is not a legally binding international agreement, and because it contravenes the MFN principal, which is a key element of the rules based international trading system.

Global issues and development policy are recognised within the remit of trade policy

Previous strategies, as well as the most recent Trade Strategy, published by successive UK governments have recognised the role of trade in achieving sustainable development goal. The key trade tools applied by the UK are the Developing Countries Trading Scheme (DCTS) and Economic Partnership Agreements (EPAs). These arrangements have more lenient provisions on Rules of Origin and their cumulation, facilitating preferential market access . They also address multiple UN Sustainable Development Goals such as SDG 10 (Reduced Inequalities) or SDG 12 responsible consumption & Production), via access to cheaper imports and supply chain adjustments and can help create enabling trade conditions that can support progress of SDGs in partner countries.

Implications for policy

International trade policy engagement signals the UK’s role and influence in global trade governance and provides insight into how policy has adapted in response to global pressures. The UK’s constructive engagement at the WTO positions it to support reform of the multilateral system. Increased reliance on a growing mix of FTAs and ‘mini-deals’ suggest diminishing returns from additional agreements unless regulatory, services, and enforcement gaps are addressed. Going forward, trade policy should balance strategic objectives with domestic accountability, and adherence to rules-based governance. It also requires ensuring that the pursuit of its interests in growth, economic security, sustainability, and inclusiveness is achieved while adhering to the ‘rules of the game. Our report, UK Trade Policy: An Independent Review provides a deeper discussion of these issues. We encourage interested readers to look at the full report with both an executive summary and recommendations for more detail.