High Imperialism

Throughout the 17th, 18th and 19th centuries, Britain exercised an informal trade system with her colonies and self-governing dominions.

Last years of empire

During the early 20th century, several political figures in Britain, led by Joseph Chamberlain, argued for a policy of Imperial Preference – both to promote unity within the British Empire, and to assure Britain's position as a world power. The policy was controversial as it pitted proponents of Imperial trade with those who sought a general policy of trade liberalisation with all nations.^{[citation needed]}

The schism helped contribute to the defeat of Prime Minister Arthur Balfour and his Conservative-Unionist government in the 1906 general election, and had serious ramifications for Conservative prospects in the 1923 and 1929 general elections. One notable victory had been the establishment of the Empire Marketing Board in 1926, which encouraged Britons to 'Buy Empire'.

In 1930, Oswald Mosley and several junior ministers in the Labour government issued the Mosley Memorandum proposing a reform of the British Empire and its Dominions into an autarkic trading bloc, alongside extensive public works programs funded by high loans and better pensions to reverse interwar unemployment and poverty. The Memorandum was rejected by the Cabinet under Prime Minister Ramsay MacDonald and Chancellor of the Exchequer Philip Snowden on grounds of cost and deficit, and was also rejected by the Parliamentary Labour Party and the National Executive Committee. Mosley subsequently departed the Labour Party to form the New Party, and later became the founder of the British Union of Fascists.^[2]

Depression and Ottawa Conference

In 1933, in the midst of the Great Depression, representatives of Britain, the Dominions, and the Colonies met in Ottawa, Canada, to hold the Commonwealth Conference on Economic Consultation and Co-operation.^[3] There had been an initial agreement on Imperial Preference, but a comprehensive agreement failed to materialise. Many of the Dominion leaders attributed this to the attitude of the British Dominions Secretary J. H. Thomas during the negotiations.

In 1935, the Canadian Prime Minister, R. B. Bennett, a Conservative who endorsed Imperial Preference, was replaced by a Liberal, William Lyon Mackenzie King. King responded to pressure from U.S. Secretary of State Cordell Hull and abandoned Imperial Preference.^{[citation needed]}

In the case of the Commonwealth, the United States was hostile to it from its inception, notwithstanding the fact that in the cases of Canada, Australia, New Zealand and South Africa, there was an overwhelming preference for a trade system based on the United Kingdom rather than the U.S.^{[citation needed]}

Post-war

The conclusion of World War II drastically affected the prospects for an agreement Commonwealth trade. The United States emerged as the foremost political and economic power, and its policy was to promote generalised free trade, primarily through the General Agreement on Tariffs and Trade (GATT). The United Nations Monetary and Financial Conference, held in Bretton Woods, New Hampshire, in 1944, had also created a direct link between the value of gold and the United States dollar, thereby establishing it as the world's reserve fiat currency under the Bretton Woods system.

The war had also left Britain heavily indebted, economically weakened, and unable to absorb the flow of exports from Commonwealth jurisdictions. The Dominions, primarily Canada, directed their trade more heavily to the US market as a consequence.^{[citation needed]}

The idea of enhanced trade between Canada and Britain was explored in the mid-1950s by the Conservative government of Prime Minister John G. Diefenbaker. The plan, in response to the Canadian government's concern with over-reliance on the United States, was to adopt policies that would see up to 15 per cent of Canada's US exports diverted to the UK. Representatives for both Diefenbaker and British Prime Minister Harold Macmillan held exploratory talks, but no agreement was ever reached.^[4]

British entry into the EEC

Britain's entry into the European Economic Community (EEC) in 1973, and its evolution as a member state of the European Union (EU) had meant that for practical purposes, the United Kingdom could not independently enter into negotiations with Commonwealth states to establish a free trade agreement. In accordance the Articles of the European Union, the Union acted as representative of all its members, collectively.^{[citation needed]} However, subsequent to the 23 June 2016 referendum and the eventual departure of Britain from the EU, Britain has become responsible for all of its own negotiations on international trade.

The Commonwealth Effect

The 1997 Commonwealth Heads of Government Meeting (CHOGM) at Edinburgh was presented with research conducted by Drs. Sarianna Lundan and Geoffrey Jones, and commissioned by the Commonwealth Secretariat. The paper, entitled "The 'Commonwealth Effect' and the Process of Internationalisation",^[5] measured whether or not Commonwealth jurisdictions enjoyed a qualitative advantage in trade with one another as opposed to equivalent non-Commonwealth nations. Their research found that even in the absence of trade treaties, there was a clear cost advantage in trade between Commonwealth nations, and that the overhead costs of doing business were reduced by up to 15 per cent in comparison to trade outside the Commonwealth.

Commonwealth Advantage

The Commonwealth Advantage program was a shared initiative between the Toronto Branch of the Royal Commonwealth Society, and the Canadian Advanced Technology Alliance (CATA)^[6] which ran from 2004 until 2008. Chaired by the Hon. Sinclair Stevens, a former Canadian International Trade Minister, the campaign was focused on developing strategic partnerships between Commonwealth-based companies.

CHOGM 2005 – Malta

In response to the lack of progress achieved in the Doha round of trade liberalisation negotiations in the World Trade Organization, Commonwealth Heads of Government, at their 2005 Summit in Malta, endorsed the idea of pursuing trade agreements among Commonwealth member states.^[1]

After Brexit

Since declaring its intention to withdraw from the European Union, the United Kingdom has begun to quickly negotiate successor agreements with dozens of countries and blocs, including many Commonwealth members. Completed agreements include those with CARIFORUM, Fiji and Papua New Guinea, (March 2019) Southern African Customs Union and Mozambique (October 2019), Kenya (November 2020) and Australia (December 2021).^[7][8] Discussions with Canada were expected to conclude by late 2020.^{[citation needed]} Several other nations that do not have free trade with the EU are also in negotiations with the United Kingdom, including New Zealand.^{[citation needed]} However, none of these negotiations have involved Commonwealth-wide or free trade or any other broader proposal.

Canada

Commonwealth trade, as such, has not been a notable policy position in Canada since the failed Diefenbaker proposal of the 1950s. Instead, Canada has pursued deep economic integration with the United States on the one hand (including the Canada–United States Free Trade Agreement in 1988, the North American Free Trade Agreement in 1994, and the United States–Mexico–Canada Agreement in 2018), and a generalised diversification of trade on the other hand including the "third option" policy of the 1970 (a failed attempt to diversify Canada's trade via negotiations with Japan and the European Economic Community). This has been reinforced with a new wave of free trade agreements following NAFTA in 1994, including five Latin American countries, the European Free Trade Association and more recently the European Union, as well the failed Free Trade Area of the Americas in the early 2000s, and negotiations towards the Trans-Pacific Partnership since 2012.

In 2005, Canadian writer and political activist Brent H. Cameron wrote 'The Case for Commonwealth Free Trade', which argued the merits of establishing a trade and investment agreement that would initially combine the most developed member economies (Australia, Canada, New Zealand, Singapore) but could eventually include developing members such as India and South Africa. Cameron conceded that UK participation would be difficult with European Union (EU) membership, but suggested that it be included if Britain were to exit that agreement:

"It is proposed that a CFTA membership and expansion be conducted in four distinct phases: Phase 1 would see the creation of an initial grouping of four nations - Australia, Canada, New Zealand, and the United Kingdom. This grouping represents the most affluent and industrialized economies of the Commonwealth. Combined with stable political, judicial and social institutions, their ability to quickly integrate into a CFTA is vitally important if the organization is to have the ability to expand and succeed."^[9]

As of 2013^[update], 75% of Canadian trade takes place with countries which Canada has a free trade agreement, but this does not include any Commonwealth members. As of 2013^[update] Canada is currently in negotiations with the Caribbean Community (primarily Commonwealth countries), as well as India and Singapore. As of 2021^[update] Canada has signed free trade agreements with the European Union (Malta and Cyprus are Commonwealth members). This initially included the UK but following Brexit, a deal was signed directly between Canada and the UK.^[10]

New Zealand

Winston Peters, the leader of the New Zealand First political party, called in February 2016 for a Commonwealth Free Trade Area modelled on the Closer Economic Relations Trade Agreement between Australia and New Zealand. In his comments, he suggested the inclusion of the UK, Canada, Australia and New Zealand in this area, with the possibility of adding South Africa, India, or others, referring to the putative free trade area as a 'Closer Commonwealth Economic Relations' area, or CCER.^[11] CCER was included as New Zealand government policy in the Labour-NZ First coalition agreement.^[12] As of February 2021^[update] New Zealand has been negotiating a free trade deal with the UK, following its withdrawal from the EU's Customs Union.^[13]

United Kingdom

This section needs to be updated. (November 2020)

Publications

Links

• CANZUK
• Commonwealth banknote-issuing institutions
• Commonwealth Freedom of Movement Organisation
• Imperial Federation
• Imperial Preference
• List of Commonwealth of Nations countries by GDP
• List of stock exchanges in the Commonwealth of Nations