Brexit Britain has found its purpose: fighting deglobalization

And it’s radiant.

“FDI in the UK is doing very well,” he tells me. That’s foreign direct investment, and it’s as good an indicator as any of the Brexit promise that Britain would be open for business. “It has reached the highest peak in history, with 2.7 trillion dollars.” That is an approximate doubling in a decade, a result of which any government would be proud. We sit down and Johnson explains the UK’s goals: “The Prime Minister has only one ambition: to become a scientific and technological superpower.”

Seven years after the Brexit vote, it seems the UK has a plan.

At this point, a disclaimer. I am a former British civil servant. I served in the British Consulate in New York and I want the country to succeed. But I know better than anyone that the country’s reputation for stability has been damaged. Getting out of Europe was far from easy: it took five prime ministers. One of them, Liz Truss, was rushed out after she scared markets.

Right now, UK economic data is mixed. The Organization for Economic Co-operation and Development is forecast Growth of 0.3% this year and 1% in 2024. At least, consumer price index inflation is trending downward, from 8.7% in May to 7.9% in June. But, in Britain’s defence, the global economic environment has been, and is, difficult enough.

So, I press Johnson with the details. What exactly is the UK selling right now?

“We are selling extraordinary people, the extraordinary R&D base that the UK has,” Johnson says. Two officers take notes and some uninvited refreshments arrive. But Johnson is halfway there: “If we’re not at the forefront of AI, advanced manufacturing and pharmaceuticals, then we won’t have the economic strength for future wealth and security.”

That is the prognosis. Ministers rarely admit that the future could be worse. So I ask for more, for your underlying analysis.

“In my lifetime, there have been two great tidal movements. These tides were low inflation and increasing globalization. Now, in the last five years, that has been reversed.”

It is a good observation. Price increases may be slowing down in the US and France. But overall, inflation persists. The days of free money are over. Meanwhile, trade is fragmenting. Consider the list of new words: onshoring, nearshoring, friendshoring, decoupling, de-risking. The heyday of world trade is dead.

Brexit killed him?

“What was the Brexit decision? To allow Britain to be a global trading power, rather than just locking itself into a major trading area but single market,” says Johnson. We have heard this argument before. It is the mantra of Global Britain, the idea that Brexit would free the UK to trade. The best new deal so far has been Britain’s accession this month to the Comprehensive and Progressive Trans-Pacific Partnership Agreement. So far, any gains are in the future.

But Johnson makes another interesting point. “We are the only government in the world trying to negotiate free trade agreements at this time. That is not indisputable.” The phrase “not irrepressible”, uttered by a Brit, means highly contentious. Many countries seek deeper trade relationships with their neighbors. But as we drink the sugary drinks, I think I understand what Johnson means. Many other trade agreements are hardly liberal. And many are also regional. Think China’s Belt and Road. Think about the EU. So Britain is not just a force for regional trade, but for international trade too?

“We are pushing against the deglobalization trend,” Johnson explains, “and Brexit was part of that.” In a world with fewer goods, disrupted supply chains and more expensive capital, Johnson argues that the UK can keep truly global markets alive. “A change in the relationship between the UK and the EU will allow Britain to do much more than it could before. And we are allied with Europe, so that will allow Europe to become stronger as well.”

A year ago, all this positivity would have been strange.

Brexit made it difficult for the UK and the EU to agree on even minor economic issues. But Russia’s war in Ukraine has provoked a collective response that will facilitate collaboration everywhere. The UK led the way in arms shipments; the EU followed. Add Rishi Sunak’s windsor frame— the prime minister’s recent agreement with the EU on Northern Ireland — and Johnson’s thesis seems correct. Britain and the EU can cooperate. And Britain can innovate, remain the center of global capital flows and lead the pack in next-generation technology.

But there is an elephant in the room: China. This one could sink our ship. The Americans, Britain’s strongest ally, are holding back China’s rise. Meanwhile, China, a source of future business for London, is rearming. How does the UK avoid this fight?

Johnson puts down his soda. “Brexit gives us the chance to flex our diplomatic muscles and be what we always were: the fundamental nation of the world. We should resume that role. And Rishi Sunak has already started to do that,” says Johnson. He refers to the Windsor Framework and the Atlantic Declaration. The latter is a blueprint for US-UK cooperation in what might be called strategic economics, things like artificial intelligence, green energy and critical minerals.

There is time for one final question. Johnson is conservative. An investor by trade, he is certainly a free market guy. So how does that philosophy square with what is, essentially, the UK’s new industrial policy?

“The government should be a risk eliminator, not an investor. So I feel very comfortable with the need for the government to partner with the private sector and develop these massive, capital-intensive projects.” The proof of this statement is in the pudding. Tata Motors recently chose the UK for a multi-billion dollar electric car battery plant. The UK government supported that project.

My conclusion? If the UK’s grand plan works out, the country will be able to ride the wave of the 21st century, innovating at home and managing global funds from both East and West. The alternative is bleak: an unimaginative slide into irrelevance.

Now Johnson must run to a dinner. And I must run to a train. So we shake hands again. A nation of tea drinkers, we haven’t finished our sweet fizzy drinks.

But then Johnson’s punchline: “We’ve got to think much, much bigger,” he tells me, still smiling as he leaves. And in that, two Englishmen agree.

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