Boris Johnson has suggested that his ethics adviser resigned over protecting Britain’s steel industry after being asked for an opinion on possible breaches of the UK’s obligations to the World Trade Organisation.
In his letter responding to Christoper Geidt’s resignation, the prime minister said he wanted advice on using tariffs to “protect a critical industry”, which “could conflict with our obligations under the WTO”.
Johnson said he was seeking Lord Geidt’s advice on whether a government decision regarding the UK’s Trade Remedies Authority (TRA) would be appropriate under the ministerial code, which requires those covered by it to act within the law. Johnson seemed to suggest in his letter that ignoring the TRA could violate the UK’s WTO obligations – essentially a form of international law.
Established as part of post-Brexit reforms to advise on trade policy, the TRA told the government last June that nine of the 19 tariffs the government had imposed on steel imports could be lifted because there was no evidence that British producers were harmed by cheap foreign imports.
In a recommendation to Liz Truss, who was then Secretary of International Trade, it said tariffs on steel sheets used by shipbuilders and tin used in cans, as well as barbed wire and steel bars for reinforcing concrete, could be lifted.
It said the border taxes – first imposed by the EU when Britain was still a member in 2018 for fear of cheap Chinese imports – could be extended to other products, including metal-clad sheets, railway material and large welded metals. pipes used for energy pipelines.
With political considerations after winning Labour’s “red wall” seats, and amid intense lobbying from the steel industry, Truss launched emergency legislation to overturn the TRA. Extended for the past year after this change, the 25% taxes above a set quota will expire on June 30, which will give another push for the industry to renew them again. Labor has also pushed for an extension.
The UK steel industry employs 33,700 people directly in the UK and supports a further 42,000 in supply chains, despite a steady decline in the number of factories spread across industrial cities in recent years. Owners include Indian conglomerate Tata, Spanish firm Celsa and Liberty Steel, the controversial firm founded by Sanjeev Gupta.
The conservatives have accepted donations, gifts and hospitality from steel industry bosses, including Gupta and Lakshmi Mittal, the chairman of ArcelorMittal. The prime minister’s spokesman said on Thursday that Johnson has not taken Geidt’s advice regarding donations.
Gareth Stace, the director-general of UK Steel, said it was essential that safeguards were enforced. “If you don’t, you risk increasing steel imports, causing significant damage to UK producers, putting jobs, production and investment at risk.”
The trade organization said it was “certain” that the extension of safeguards was compatible with the UK’s WTO obligations. Crucially, the EU has just reaffirmed its own steel guarantees until June 2024 and issued a WTO ruling that the measures are in line with the rules, Stace added.
Experts said this month’s extension deadline could be why Geidt was being asked for his opinion, but questioned why an adviser to the ministerial code was questioned about the legality of trade rules.
“I’m completely confused,” said Peter Holmes of the UK Trade Policy Observatory at Sussex University. “When introducing anti-dumping measures, you almost always claim that what you are doing is WTO compliant. So to ask Geidt’s opinion on an anti-dumping duty is completely bizarre. He has no expertise in this area. You would ask Suella Braverman [the attorney general] whether it is legal.”
David Gauke, the former secretary of the conservative justice system, suggested that this could be “more” than Britain’s compliance with WTO rules. Either the Attorney General concluded that the tariff plan was illegal and suggested an alternative course of action, but ministers considered plowing ahead anyway.
“So much so that Brexit is about ‘free trade’ as the prime minister loses his ethics adviser over the desire to break WTO rules to introduce illegal tariffs on steel,” he tweeted.
The Prime Minister’s spokesperson said Johnson was happy to consult with Geidt and get his opinion on how this interacted with the ministerial code.
The WTO said its secretariat was not empowered to interpret WTO agreements and would not comment on the domestic policies of any of its members. Trade disputes are brought before the WTO when a member believes that another member’s trade practices affect world trade in a way that violates the organization’s agreements.