 Well, gweithio arall, dwi'n gofyniaid, mae'n gweithio'n gweithio'n gweithio'n gweithio'n gweithio'n gweithio'n gweithio'n gweithio. Felly mae'n gweithio'n gweithio'n gweithio yn sefyllfa'r Seminar Dyma a'r sefyllfa'r Brexit yn ysgwrth. Mae ymddangos i'r cwrnod Caethrin Barnard a'r prosieff ym Llywodraeth i'r Fyglwyr, a'r swyfer o gweld, Martin Donley. I will come back to him in a moment. With me and Marcus Gearing, who is well known to some of you, and also Lauren Bartels, also well known to others of you. We hope that you will participate in this seminar once Martin has finished talking. If you can do it via the Q&A function on the system that would be really helpful. I also want to say this is Chatham House rules, so anything you hear should not be attributed to anyone that would be extremely helpful. So, Martin Donley and I have had the pleasure of knowing each other for a while as we've appeared in various Brexit events and before various select committees. Trying to talk a bit of hopefully sense about Brexit, I'm not sure either of us have really succeeded in that respect, but at least we have tried. But Martin has a genuine qualifications, unlike myself. Martin is a very senior civil servant who has worked his way around Whitehall and Paris and various of the key departments, in particular the Foreign Office. The business department, which has undergone a number of name changes, and crucially for these purposes, he was also responsible for setting up Department of International Trade, out of which all of the trade negotiations which the UK hopes to engage in will be conducted. And he left government in 2017. He's got an academic interest in the other place. But also he's now working for Boeing and of course in a sector which is facing considerable challenges through a combination of COVID and Brexit. Now, Martin's very kindly going to talk for 20, 25 minutes or so, and then he will take questions and I hope we can have a discussion as well, particularly from Marcus and Lauren. So, Martin, over to you and thank you very much indeed for speaking to students. Thank you, Catherine, and good afternoon everyone. I should just highlight that I am speaking of course in a personal capacity and I wouldn't want my remarks to be taken as representing anyone's views except for my own. I want to say a bit about trade, a bit about legal frameworks, and a bit about government. Because my thesis is really that all three of those have changed over the last 20 years, and to some extent our frames of reference haven't changed with them, and that's part of the difficulties that we now face. I'm very happy to pursue any of these areas with you in discussion conscious that there's a lot of expertise, both among Catherine and academic colleagues and I'm sure in this seminar group. I want to give you a little more background in my own career. I've worked on European Union issues, a first budgetary and then legislative on the single market, particularly in financial services and I was involved in Brussels for four years. On Britain's team of personal advisers his cabinet, setting up the financial services single market until 1992, which gave me some insight into the detailed nature of European community as they were then European Union directives, and the entire regulatory and legal structure including of course, the role of the court, and the wider competition and level playing field requirements. I then came back into government and I worked in Paris for the French Finance Ministry for a while. I then worked for Tony Blair on economic coordination of European issues from the Cabinet Office at the center of government. I joined the foreign office and I was responsible for global issues, including trade and the G seven as the foreign office Sherpa for four years from 2004. Then from 2010, I was the permanent secretary of the business department, also responsible for trade at that time, and then set up the international trade department Catherine said, after the referendum. So, I've had a bit of practical experience of this and let me start by talking about trade. It was always seen in government, certainly through the 80s and 90s is a very technical area. We obviously had that it morphs into the WTO finally in the 1990s, and it was essentially seen as about the complex and frequently tedious process of reducing tariff levels between industrialized countries. And it pretty much took place below the surface the people who did trade were a bit of a subset. And I started my career in the treasury the treasury didn't really bother with trade, except when something interesting was going on when they were trying to take it over from the department of trade and industry. The department of trade part of the old DTI was in favour of free trade of the department of industry part tended to be in favour of protecting vulnerable sectors so you had this process working out inside government. That all began to change, I think in two ways. First of all, the whole process of setting up the internal market inside the European Union. Made people by people I mean particularly politicians begin to understand that trade was not actually about moving crates on and off ships, which was frankly the image that many of the politicians on all sides of Parliament had of trade was about, you know, you've got the crate off the ship and either you paid a tariff or you didn't or you filled your quota and that was that. Of course, most trade was never really like that, but it was getting much less like that. And then of course on top of that there was agriculture, which raised all the sets of issues that we can talk about in terms of the politics of agricultural protection and of course the famous or infamous common agricultural policy. So it was seen as a slightly separate set of issues and then there was central trade, you know and motor cars and paint and chemicals and so on. But setting up the internal market showed people that actually trade was much more about regulation than it was about tariffs or quotas. And people thought that the single markets only in the UK, the parts of the British government thought it was about deregulating. You understand that actually it was about regulating, you had to have a regulatory framework with laws, and you could sometimes mutually recognize each other's laws but quite often you had to have a new framework and then you had to change it as industries or technologies developed within that or as areas such as environmental issues or social issues or workers rights came through and people began to realize that trade was not actually quite as separate in its own box. And that was, I think, the beginning of the difficulties in terms of the United Kingdom's wider approach to the European Union. It's no coincidence that the arrival of the single market in 1993 and the mastery treaty that went with it started to make the whole European element of government much more contentious than it had been. And then through 1990s you saw roughly similar process, one could argue, in the otherwise dusty corridors and I say that with respect of the then World Trade Organization from 1995 and famously of course in Seattle in 1999 I think we had riots in the streets and suddenly trade was political. And that was because trade was of course about access for developing countries to markets, it was about the growing Asian economies playing their part in an increasingly globalized world, the fall of the Berlin Wall had led to a resurgence of Eastern European countries rejoining global markets. And of course, fundamentally, this issue of trade, which wasn't just or mainly goods anymore, or even agriculture, but was about services and intellectual property. And these questions are preferences for developing countries who needed agricultural access to have the money to pay for the other goods and services they wanted to import. All of that suddenly became political as it should have been because trade is fundamentally about adjustment. It's about economic adjustment and who is going to do the adjusting and how fast are they going to adjust. And if that is not political, I don't know what is. So trade as it were came out of the shadows WTO, and the rules based system which was more or less set up to get us out of the highly protected 1940s by the late 1990s. That was a new area of how do we manage global trade. And of course, again belatedly because the politics legs, the economic reality, the fact that much world value added trade was in the loosely defined service sector, which of course the countries didn't really do much about. And how do you manage services, and of course services often involve people. So you have the question of a free movement of people. Again, a highly politically charged subject, even 20 years ago. There's a structure in the World Trade Organization round about 160 odd countries, you know the basics and essentially consensus driven up until the Uruguay round in the 90s, essentially run by or pushed by the US on one side and Europe on the other with Japan coming to a place and I simplify here, but by the late 90s that couldn't work any longer. So you have a bit of a deadlock after Seattle, and then you get the Doha round, and you only really get the Doha round starting in 2001 because of 9 11 a couple of months earlier. And there was a feeling that trade had a best stagnated. In 2001, there was a need to show that there was a degree of solidarity in the free open market world, and the investors wanted to give a political signal. So the Doha development round to make trade rules fairer for developing countries started then, and was due to finish by 2005. So it was a political choice to do that. Let me leave the Doha round for a moment and and go back to what else was happening from a UK perspective. We were having in Europe this unique rolling negotiation, which is the European Union's negotiation on a range of economic and social issues. And that had actually reached a deadlock by 1997, because the then Conservative government was not prepared to accept the social chapter, which many of the socialist governments in Europe, led by Jacques de Law as a very effective European Commission president said you can't have open markets you can't have free trade free movement of capital without protecting the rights of workers. And the Conservative government was not prepared to accept that this could be part of this trading block. And the deadlock was only ended by the massive majority of Tony Blair in 1997. Of course, the Labour government had no difficulty with the social chapter and the rules about shared maternity leave about holidays about the rules for temporary workers, all these things which got added on were actually very popular, including in the UK. So, for the time being it looked as though we'd agreed that that was an acceptable positioning. And of course, the gap between the enforcement of European Union rules through an effective if somewhat clunky system of law, which could and did protect individual firms and consumers. The gap between that and the WTO, which, again, as you will know, better than I do. Didn't and doesn't protect individuals that's not what it's there for it was essentially a framework and marketplace for countries to come together and reach agreements and, if necessary, be allowed to come together, but only up to the extent of collectively agreed limits. So, you know, it was basically trying to put some eye for an eye and to throw tooth controls around trade disputes that it could be no more than one eye for one eye. The gap between these models and the attempts of the WTO system to deal with trade and services to deal with these intellectual property issues. I discussed to deal with the politics of US subsidies for cotton affecting cotton markets in Africa and affecting African economies, or EU restrict restrictions on various sorts of seasonal agriculture coming from other markets, including Africa, how you handle all these. The difference between the two sorts of trade law inside Europe and outside it became increasingly difficult, especially when you added in government procurement and trade facilitation and trade links with investment and level playing competition issues and so on. So not surprisingly, perhaps the WTO didn't get very far with its negotiations on Doha, and every so often in the 20 zeros, the issues would come back every year to the ministerials or to the G7, which is worth bearing in mind because although it has no statutory responsibilities, the G7 actually provided political leadership at the time the countries and briefly actually at that period for the G8 including Russia did have at least 50% of global GDP, and therefore when they took up a position that made a difference, but they found it difficult to get beyond platitudes on free market and open trade. And I can tell you that because I spent some of the best hours of my life negotiating trade declarations made by the G8 for four years. I don't recommend you go back and read them. I don't think anybody ever really did, but they were incredibly difficult to negotiate because you had to get consensus. So what you were really doing was papering over all of the cracks that existed between countries, and with words which could mean essentially both positions, except interestingly the way the Russians negotiated it they would agree to things which you thought they shouldn't really have agreed to because that wasn't anything, and then they'd have a sentence at the end which sounded perfectly harmless to everybody else, but from a Russian perspective meant that they could go on doing everything that they were doing anyway. So, you know, we produce these texts, and they had a political purpose to show that everybody still thought that more open trade was a good thing but just they wanted to do it our way. And what was more interesting in a sense, as the 20 knots continued and became the 2010s and we still weren't getting anywhere was people realise the growth of China was a game changer and again this had been obvious from the 1990s, but I don't think it really the politics caught up with this, probably until the 20 knots the sort of financial crisis period and after, and then we realised that China didn't easily fit into the framework we'd set up China had of course joined the WTO. And that had helped at the beginning of the decade Chinese growth and arguably everybody else's growth as well. But it was also clear that China was a very big weight on the seesaw and things weren't carrying on in adjustment terms the way they had before. So, you had the EU US attempts to produce a tea chip to try to produce a transatlantic trade deal, which would give the Europeans and the Americans the ability to go on setting standards essentially outside the WTO framework which was grinding to a halt. But with enough economic heft that the Chinese would have to accept the standards which the rest of us were setting. And you could see a strong interest for the United States and for the European Union to do this. And everybody said that, but despite that it was not possible to reach that agreement and again many of us spent many hours grinding through this. And that was because of the trade negotiator. So let me go back to trade now. What the WTO did produce and in fact GATT already produced was over the years a card of people who really understood world trade law and understood the minutiae of negotiating line by line on trade. And I haven't really ever met any ministers and frankly very few senior officials and that would include me who ever had the patience to sit down and go through a line by line negotiation. I mean it takes a certain type of person. What was clear to me though in the 2000s was that we had too many people doing this because we weren't producing the outcomes because it was too political it was no longer technical process. So one outcome I am personally proud of although I've never received any credit for it was during this period in the foreign office I reduced the number of people doing trade negotiations because they were going around the world meeting each other. I'm sure they're working very hard and I hope they were having a nice time to, but they weren't actually producing anything. Most people were more use on you know climate change negotiations or separate intellectual property or just bilateral issues because the trade technical teams were not connected. They had to negotiate on politically sensitive issues and they did not have the space to do so. No trade negotiator could change that government's agricultural policy for example. No trade negotiator could give up a sensitive tariff in an industrially declining sector and say well look we'll make up for this you know on intellectual property or on access to your procurement market. They did not have the authority to do that. And governments found it extremely difficult to make those trade offs as well. With you know the European Union having a unified government procurement market. How do you give the Americans access to this when the Americans do not have a unified procurement market, and they have state and federal levels, and they cannot, and perhaps didn't necessarily want to try too hard for political reasons to offer an equivalent set of trade off. Over time, the level of trust needed to make these trade offs was being eroded at political level. The issues were very technical at technical level, and you could never join them up. So every time minister said we will give new impetus to this negotiation. It simply faded away because it wasn't impetus that was needed. It was somebody who could understand all of the detail and also prioritize some issues over others. And accept that by doing so, they might not get recompense for several years in another area. And that was just too much to deliver and to political and through the 2010s, those levels of trust eroded. Government found it increasingly difficult to make those trade offs internally. And if that's perhaps a separate area we can touch on in discussions, I would argue that the move to 24 hour government and the necessity of communicating including online for at least the last decade perhaps 15 years took away the private space necessary for the slow government which was required to come up with some of these extremely difficult and technical trade off. If you think I'm exaggerating, I'll give you one example from a trade negotiation, which I know of, which the country should perhaps remain nameless. But one of the negotiators negotiating on beef got confused between the quotas of beef with bones in them and the quotas of beef without bones in them and went for the wrong one. And that meant that actually less beef and more bones was being exported in the quota. And this person I think nearly lost their job accordingly, but it's just an example of the level of detail and of course the political sensitivity of that detail. You can never ignore the detail in a trade negotiation, but neither can you easily work up from the detail in one area into the detail in another area. And I think that's what we've we've struggled with. In parallel, of course, was the reality that trade was becoming more about services, although the old manufacturing and services definition I would put forward is frankly irrelevant. And one of the problems it causes is that we don't really know how much trade is going on because our figures are not accurate. And services involve regulation, they involve people, and they were very difficult to manage. Mutual recognition of standards involved providing trust in another country's health and safety or environmental or technical standards. Or even if the standards were all agreed in the way that they were being implemented, and the UK, let it be said, is not guiltless on this, because you may recall the BSE issues in the late 1990s, which were caused by lax UK regulation of how meat was rendered. And, you know, we all have our, we all have our lack of, if you like, angelic standards in these areas. But once you've got outside of the European Union, having mutual recognition of standards, let's say of, you know, the amount of lead or toxic substances in paint, which might go on to children's toys, which might get imported into your country. These can literally be life and death issues. So the lack of trust in standard setting already made services difficult, that pressures on migration from at least 20 years ago made the movement of people to deliver services much more problematic. And then of course you had the digital data age, where moving data around raised issues of privacy, and also of commercial confidentiality. And that was just way outside where the WTO was ever going to get by consensus. So you, you had attempt some plural lateral fora to do something about this. But again, it proved very difficult. You could do some things bilaterally with the large blocks of the EU was one. And the large blocks together could do some things and I'm sure you'll be looking at data agreements separately. But in the last decade, the growth of digital services and businesses has, I would suggest made even the statistics we have on trade. Grossly inadequate because nobody really knows how much data is being moved around at any one time, who's doing what to it and where the value added is landing. All of that, I think meant that the WTO was pretty much stuck in the mud before the election of President Trump in 2017. I won't talk about the last four years. You will all know what's happened. All I'd say is that the fact that the ministerial WTO in Kazakhstan was not held this June, I didn't really affect anything very much because expectations were so low anyway. The fact that the WTO lost its director general is perhaps a symptom of where we are in that area. I haven't talked about the implications of Brexit, perhaps we can pick that up in discussion, but I would leave with you because I do want to leave time for a discussion and for you to take this where you want to go. The idea that trade has become more difficult to negotiate because it's become more political as it should be because it's about economic adjustment, but also because it requires a combination of mastery of detail and of trust in the framework within which you are working to deliver things over time, which has been eroded by wider political forces. Governments have actually eroded, and this is certainly true in the UK, their capability to manage these things because civil services have been slimmed down. I think in most countries and certainly in the UK there is less expertise than there would have been 15 or 20 years ago simply because there are fewer people and there are some issues about memory. But more importantly, there is less safe space to hold technical discussions before they become political, even inside government. And I think the legal frameworks that we work in around enforcement have become more questioned and the status of law itself in this area is perhaps more under debate than it has been. But that's an area you all know more about than I do, so I will stop there. And I hope I've said enough to encourage some questions on these or any related issues that you want to pursue. Thank you. Thank you very much indeed, that was absolutely fascinating. I'm intrigued about two things and while I raise these questions I'll give the students a chance to put their questions in. I would like to hear more about your views about the status of law itself becoming a question that's clearly a major issue for those studying law. Are you saying that the Brexit negotiations are doomed to fail because there isn't enough space for the technical work to be done before it becomes political. Right, thank you. Yeah, I think. I think from a policy makers point of view, law has always been something which you socialized rather than you tested the boundaries of. So, in the WTO context where dispute resolution was at best slow and difficult and at worst perhaps I'm never going to deliver. You didn't want to get there, and everybody agreed implicitly you didn't want to get there. Therefore it provided an additional momentum, technical and political to arrive at some sort of compromise that avoided you getting there. And when you fail to do that, as for example in the Boeing Airbus dispute, you know, you didn't have an entirely optimal outcome. I think everybody realized that. But if you stop caring about maintaining the integrity of some dispute resolution framework which you call law and inverted commas, then it doesn't exist anymore. If I allowed myself a parallel, I think I would have it in UK domestic terms with the Sewell Convention on devolution. And, you know, I'm just as an economist really by background, but I did have to do quite a lot of European law to manage working in Europe and I'll come on to that. But I was reading a textbook on UK law written three or four years ago, which suggested that really the Sewell Convention was now sort of part of our constitutional arrangements because that was how we did things in this country. And it turns out of course not to be true, but it was true when people believed it was true. So I would just suggest you that there is an important subjective area of legal rule based provisions, which only work you know if you don't test them too hard. And if you have people who test them too hard, then you find that they're not really there. It's not all supposed to be true when it comes to international treaties that I'm afraid I have nothing to say about the UK government's behavior in passing legislation, which appears to renounce several key aspects of an international treaty. They only signed a year ago, but signing it a year ago is not the relevant point here either. It's really, I think of these things as a codification of trust. If you do not have the trust, then you can't codify it, but if you don't codify it, how do you have a framework in which to do your business. Of course, European law is separate from that because there are sanctions. I think this is where there is almost a metaphysical element to the talking past each other, which we see in the UK EU Brexit negotiations and I say this is a purely personal view. Because it seems to me there is certain incoherence in a national position that says we want to reach an agreement, but we do not wish to be bound by that agreement in any way, which could potentially have consequences, such as sanctions, which we would not would not find acceptable. And I don't see how things work if you are not prepared to bind yourself in some way that works over time, and which we tend to call however loosely law. If you don't have it, you're not going to be able to run a rules based advanced economy, which requires what we loosely based law to provide people with certainty and transparency about how these decisions are going to be made and who makes them. And you can then change them over time, of course, nationally or in European, and you can negotiate them. But what you can't do is give yourself unilateral opt outs from them. So I do find, I'm afraid, conceptual incoherency, which makes me think Catherine to your question that I don't see how we can have an agreement, because on what basis will the agreement be made. And if we do have an apparent agreement, is it really there, because when you test it, if it proves not to be there, was it ever there in the first place. And of course the shoe really pinches on this, as you know so well, on the issue of the Northern Irish border and the agreements that we made the good Friday Belfast agreement and since then. And on that, I think ultimately, it may come down to an element of force manager, because we've heard what Joe Biden has said if he becomes president there will not be a trade deal with the UK. If the UK is not implementing the spirit in the letter of the Irish agreement, I have no reason to to disbelieve him, and a lot of people in Congress say likewise, but you can't resolve every dispute on the basis of real politic. I don't understand how we reached an agreement between this government and the European Union, even though it is clearly in everybody's interest to avoid having tariffs. Nobody needs the money. The additional bureaucracy is just a restraint on trade which affects both sides, although it affects the UK more. It's clearly a loss of shared welfare, but the only way to remove it is to have agreements on the framework for law in inverted commas, which provide people with an understanding of how this works if there is a dispute.