Keir Starmer is being urged to adopt a trade plan that could unlock £250bn in economic growth and savings – even if Donald Trump unleashes direct tariffs on the UK.
With senior government sources now admitting that tariffs from the US on UK trade are “now looking inevitable”, the International Chambers of Commerce (ICC) has published its plan for growth which it says would free up billions in investment simply by scrapping outdated paper-based systems.
There was disappointment that chancellor Rachel Reeves did not mention trade in her spring statement last week as she focused on putting a squeeze on benefits to balance the books.
According to the ICC, outdated paper-based trade systems are stifling economic growth and productivity, but bold action can position the UK as a global leader in 21st-century trade.
It claims that by embracing digitalisation, regulatory modernisation and strategic partnerships, the UK can create a cheaper, faster, simpler, secure and sustainable trading environment.
It believes the plan would have clear benefits for small and medium-sized companies, leading to 35 per cent efficiency savings and access to £22bn in working capital.
On top of this, the main benefits of an overhaul would be to unlock an estimated £25bn in trade growth and produce £224bn in efficiency savings.
It claims it would reduce trade transaction times from two to three months to just one hour, while bringing in an 80 per cent reduction in trade transaction costs.
The ICC also estimates that shipping costs could be reduced by 18 per cent and workforce productivity could increase by 60 per cent.
Central to this plan is the International Centre for Digital Trade and Innovation (iC4DTI) – the UK’s flagship institution for digital trade. Co-founded by ICC United Kingdom and HM Revenue and Customs, iC4DTI is the only centre of its kind globally, aligning public and private sector efforts to digitalise trade.
Chris Southworth, secretary general of ICC United Kingdom, said: “With international trade on the cusp of a digital revolution, the UK has a unique opportunity to lead the way. We have world-leading legislation in place and have the opportunity to scale the benefits to every company.”
But he regretted the lack of mention of trade in the spring statement.
He said: “We had the spring statement that didn’t mention anything about trade. Within 24 hours, we then have 25 per cent tariffs from the Trump administration. It just demonstrates the strains that businesses are under and the impact that has on our economy.”
He also questioned the pursuit of a full trade deal by the government in trying to overcome the tariffs expected to be unleashed by the US on Wednesday.
“We’ve tried twice to get trade deals with the US, and we’ve wasted 10 years in the process and still don’t have a deal. And there’s good reasons why we don’t have a deal, and that’s because of food standards in the UK, hormone beef, chlorinated chicken, US companies having access to NHS services, and on the other side, it’s UK companies having access to government procurement.”
He added: “Can we get a deal? Yes, we can, but the free trade agreement type, all-singing, all-dancing deal would be extremely difficult to do with a big question mark whether we’d ever actually achieve it. What we are saying to government is, let’s go for a modern digital economy agreement, which is much more friendly and agile for a services economy like the UK and the US, and possibly even bolt in a finance and investment deal behind that.”
However, he argues that the immediate impact can be achieved by overhauling the paper-based trade systems and digitalising.
He said: “Outdated bureaucracy is holding back the UK’s economic potential. With this plan, we can modernise trade, unlock growth, and strengthen our position as a global leader in digital trade.”
