Something concrete for the trade vs aid debate:

 

• Yoweri Museveni

A plane from Africa can fly Britain to its global future

Uganda does not need aid to prosper; it needs to trade with the United Kingdom. That will benefit both sides

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Credit: ABUBAKER LUBOWA/REUTERS

Yoweri Museveni

25 May 2025 4:32pm BST

Last week, we saw a glimpse of Britain’s present and future. First, a “reset” with the European Union, touted by London as a step to lower barriers and increase trade in similar food and fresh produce between neighbours. Second, a Ugandan plane flying direct to the UK for the first time in more than two decades, carrying a cargo of produce that Britain cannot grow. 

It is not for the leader of a country far away to judge the rights or wrongs of closer trade cooperation between Britain and Europe. But what is undeniable in 2025 is that the oft-quoted “first rule of trade” – that proximity matters – is a fiction. If it were true then the proportion of trade the UK conducts with the rest of the world would not have accelerated for the last 20 years, while in parallel trade with its continental neighbours declined.   

It is a fact that many nations around the world proudly possess older and deeper ties to Britain of shared language, culture, and trade. Many, like my own country Uganda, are members of the Commonwealth, and have sought to re-kindle brotherly relations since Brexit in 2020. 

The fruits of this opportunity are increasingly visible: trade deals have been signed with Australia, New Zealand, the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), and India. This shows just how many seek to recalibrate the old bonds that predate Britain’s time in the EU, and how regardless of any reset with your neighbours your country’s trade relations are now permanently global.

That’s why the landing of Uganda airlines flight UR110 at Gatwick last week represents such potential. There is simply no reason in today’s world why Britain should not seek to increase trade with every continent – and not least Africa when it contains 11 of the world’s twenty fastest-growing economies. 

In the UK – and her continental neighbours – green beans cannot be grown beyond the summer. Coffee beans cannot be grown at all. In Uganda, both – and more – can be harvested all year around. When much of what you and your neighbours grow is similar, and according to the same seasonal rotations, that makes them as much trading competitors as partners. Uganda, on the other hand, is complementary. 

But we are ahead of ourselves. There are many barriers to trade between Britain and Africa and they will not be lowered by the first planeload of coffee, chocolate, and chillis on flight UR110. Those will be lowered by trade agreements that reduce tariffs, by addressing non-tariff barriers to trade and, just as importantly, by challenging prejudices about Africa – prejudices Africans too must work hard to combat. 

In 2023 the UK launched the Developing Countries’ Trading Scheme, a post-Brexit trade policy that reduced – in many cases to zero – tariffs on a raft of products for 65 emerging market nations with more than half from Africa. 

This major statement of belief in free trade and reengagement with the world was welcome. Yet lowering a tariff on, for example fresh produce, does not automatically mean a single extra pea or mango will be imported. The most devastating barrier facing African farmers – indeed most worldwide – are the non-tariff barriers put in place in the name of food standards. 

Everyone wants safe and clean food, and who has not tasted the best when it is grown naturally, in a garden, smallholding, or allotment? Yet such produce would not be legally permitted for sale in a single British supermarket under a constellation of rules and regulations slated to both protect and seemingly at the same time to remove all taste. 

Extreme certification and regulatory barriers are destined to benefit huge commercial agribusinesses that can afford to meet them, while they wreck the chances of smaller producers through prohibitive costs from exporting to the UK. This is a system that empowers not people but multinationals.

There must be a solution between friendly nations that with sufficient imagination can land a happy medium. That same approach should be turned to address preconceptions about Africa and its expectations of relations with Britain. 

Too many in the West believe Africans want their charity, and their money. They are wrong on the first, but right on the second. We do not want your aid; we want your trade. We want the honesty of being trading partners, not the dependency of handouts. 

Help yourselves by helping us supply you with the food and goods you cannot produce. Sell to us the services and goods we cannot make. Manufacture and assemble with us and bring in technology and we give you the raw materials. This is what the future of trade looks like. Britain can make the first planeload of Ugandan produce in two decades not a footnote in its new global trade relations, but the reawakening of something older and more complementary than we have known for a long time. 

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Yoweri Museveni is president of Uganda

To go with the diagram comparing US & EU

 

Starmer’s ‘EU reset’ is a fairytale There will be no sunny uplands

Britain and the EU remain drawn to each other. Photo by Justin Tallis - WPA Pool/Getty Images.

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aiBeyond BrexitBrexitEUEuropePoliticsregulations

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Wolfgang Munchau

May 19, 2025   6 mins

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Back in 2020, when Brexit dawned, the UK was an average economic performer within the EU. Five years on, it is still an average economic performer relative to the EU. From an economic perspective, then, Brexit was a non-event.

Try to tell anyone this though, and both sides will erupt in violent disagreement. The Brexiteers insist it is just a matter of time: the sunny uplands are within reach. The Remainers, too, say it just takes time: the sheer horror of Brexit will yet materialise.

Well, it won’t. And the reason why Brexit has yet to have any visible impact is because, just like in Hans Christian Andersen’s The Emperor’s New Clothes, there was never anything to see. The EU’s single market is simply not what it says on the label. It is not a genuine single market. If it were, Brexit would have been a big shock. But, as Mario Draghi reminded us recently, the EU’s internal trade barriers are actually higher than the ones Donald Trump has just imposed on Europe and the rest of the world.

I am not denying that the EU operates something that is called a single market. And in the years after it was formally introduced in 1992, it did produce higher growth. Where markets were once fragmented and protected, the EU’s single one was more open and liberal. But over the years that has changed drastically. Today, it is hampered by a thicket of rules and regulations, many of which are detrimental to business. It might be large, but the single market is far from free.

A perfect example of this is the EU’s anti-tech legislation, which is particularly leaden — as Draghi’s report on Europe’s competitiveness pointed out. But the UK, while it was still a member of the EU, only ever implemented the first part of the legislation: the general directive on data protection. As the co-owner of a small publishing company that has a lot of European customers, I can confirm that the GDPR requirements are an absolute nightmare. After the UK left, however, the EU doubled down with regulations for AI, the crypto-industry, for digital markets, and for digital services. It made companies responsible for human rights abuses in their supply chains, and it imposed on itself the world’s most stringent Net Zero regulations.

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The single market was also meant to be for goods and services. But in reality, it is mostly for goods only. Services are the bigger part of the economy by far, yet the volume of intra-EU trade in services only accounts for 15% of GDP, while that of goods accounts for 50%. For the UK, a country whose main export is services, the single market was even more irrelevant than for the other EU members.

Nonetheless, there is one place where the EU single market lives on: in our minds and our discussions about Europe. I have spent a fair part of my life on panels, and there are always talking heads who will elevate the single European market to be the EU’s crowning achievement. This is a story told too many times by too many idiots, signifying a degree of self-delusion that is at the heart of what the EU has become.

The Europeans are good at putting on a show. And this one has been playing for a long time. Our modern equivalent of the emperor with no clothes is the sight of European leaders taking the overnight train for a photo op in Kiev, with no money and no weapons in the bag.

It’s the same watching Keir Starmer trying to reconnect with the EU. In a year full of critical events, today’s reset is a great big naked non-event. If leaving the single market was an economic anti-climax, then, surely, putting bits and pieces of it back together isn’t going to make a difference either.

“In a year full of critical events, today’s reset is a great big, naked non-event.”

The same logic applies to the UK accession to the EU’s €150bn defence fund. The EU always puts misleading headline numbers on its programmes. What you have to do is to divide the headline total by the number of years. The money is to be disbursed over a period of five years, so the €150bn shrinks to €30bn. If you add the UK to the mix, this translates to 0.1 percent of total economic output. Since EU programmes are frequently not fully disbursed, the actual money will be even less. I did a similar calculation for the Covid recovery fund five years ago and came up with the same sort of numbers. The economic impact is simply statistical noise. But it does give pro-Europeans the opportunity to make some political noise. It allows them to say that the EU does defence now. And it allows Starmer to claim that he is resetting the relationship with the EU when nothing much of substance will change.

Now I am all in favour of the idea of a single market — but not this monster. My idea of a single market is one with low regulatory barriers, a market that would, by definition, have to take the member states out of the equation. But right now, every country implements EU rules in their domestic legislation, which is where Draghi’s internal barriers arise. A genuine single market, and a common financial market, would require nothing less than a smallish federal state. And this is never going to happen.

Instead, the EU will continue to stagnate under the burden of its regulation. The paths of the UK and the EU will continue to diverge. The UK has clearly not made the most of Brexit, but its economy is functioning, more or less. The City of London is doing well despite all the gloomy Brexit forecasts. And one of the things that is driving success is the financial innovation that would not have been possible inside of the EU. The UK currently has more AI business than France and Germany combined, and almost as much as the whole of the EU. While you would struggle to spot the impact of AI in anyone’s national accounts today, in 10 years’ time, AI will certainly be playing a bigger role in our societies and economies.

Britain is well-placed for this. But, hamstrung by its legislation, the EU is going nowhere. The entire thrust of its AI and data regulation is to protect consumers against abuses by companies. An interesting question is why the normally so powerful business lobbies in Europe allowed such an anti-business regulation to happen. I suspect that the lobby groups care about existing businesses more than about new businesses. Modern tech is an exciting new start-up opportunity. The old companies that are so well represented in Brussels are techno-Luddites.

The UK and the US, in contrast, have always been far keener on AI because both have large capital markets. Investors don’t care whether the company that delivers growth is old or new, large or small. And the US, in particular, managed to channel private capital to the new tech industries.

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The EU failed to do this. Instead of real investments, it has programmes with fancy names like “Horizon Europe” or “Digital Europe”. The European Commission makes the bold claim on its website that “the EU is spearheading AI research, collaborating with scientists, and funding projects to develop safe and ethical applications of AI, fostering AI ‘made in Europe’, from the lab to the market”. I recall a time when Angela Merkel wanted Germany to be the world leader in AI. This now seems delusional.

My expectation, then, is that the EU will remain in denial for many years, and that the UK will perform a little better because it is not weighed down by bad regulation. But I see no sunny uplands either. Brexit would have been more successful if the UK had used its regulatory freedoms to greater advantage, starting with data and tech. Getting rid of the wretched GDPR would have been a good first step. And today, we have empty, outdated talk from Starmer about dynamic alignment with the EU on product standards — following EU rules on things like safety standards for widgets. I struggle to get excited about stuff like this because it is totally irrelevant to economic success or failure in the future. The 21st century economy is no longer one of standards committees and industrial patents.

So forget the reset. This is about nothing more than good relations with your neighbours. There is nothing wrong with that. Neighbours can organise a street party, or set up a neighbourhood-watch scheme. They can agree to trade more home-made cookies for lemonade. But they are not moving in together.

Europe’s neighbourhood watch scheme is Nato. It is not the EU. In fact, defence is specifically excluded from the most important areas of the EU’s competences, like the single market. That, though, does not stop the EU from having a defence commissioner and politicians talking about nothing else these days. It is a sign of decline when the reality of your existence does not match the image you have of yourself.

This is exactly the story of Andersen’s fairy tale. One day, some kid will remark that there is nothing to be seen. And then, all of a sudden, reality will dawn.

But even then, will anything change? As Anderson’s tale concludes: “The Emperor shivered, for he suspected they were right. But he thought, ‘This procession has got to go on.’ So he walked more proudly than ever, as his noblemen held high the train that wasn’t there at all.”

Supply-side/red tape but from a slightly different perspective:

 

America’s Democrats should embrace “abundance liberalism”

Two new books contain much to commend them

Illustration: Álvaro Bernis

Mar 18th 2025

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Think of America as a vast economic experiment. The country left the covid-19 pandemic full of stimulus, and with a roaring stockmarket. Which places managed to channel this vigour into new companies, houses, power stations and intellectual property? And which let rents and prices surge instead?

Three years on, early results make painful reading for Democrats. Red states have comfortably outgrown blue states. The gap is particularly striking among the largest: Florida and Texas have left California and New York in the dust. In last year’s presidential election, some of the sharpest swings against Kamala Harris could be found in city centres, where the party has had its tightest political control—and free rein to put ideas into practice.

On economics as well as politics, therefore, the left must work out what has gone wrong. Two new books—“Why Nothing Works” by Marc Dunkelman of Brown University and “Abundance” by Ezra Klein and Derek Thompson, a pair of journalists—suggest an answer: that excessive regulation has hurt America by blocking housebuilding, infrastructure and innovation. The books crystalise ideas that have been swirling around newspaper columns, think-tanks, city-council initiatives and social media.

Online supporters say that they are “abundance-pilled”, adopting a trope from “The Matrix” (in which the protagonist takes a pill to escape his humdrum computer-simulated existence). And the serious label for these ideas, especially in their left-leaning incarnation, is “abundance liberalism”. For his part, Mr Dunkelman argues that progressives must move away from so-called Jeffersonian instincts, which favour localism, diffuse power and plentiful vetoes, and towards Hamiltonian ones, which point to centralising power in order to get things done.

Lingering over both accounts is the spectre of Robert Moses, an all-powerful bureaucrat who from the 1920s to 1960s built the bridges, roads and tunnels that undergird modern New York, and is the subject of Robert Caro’s cutting biography, “The Power Broker”. Today’s regulatory mess began to emerge in the 1970s in large part as an immune response to the domineering methods of Moses and his imitators, who chopped through neighbourhoods with motorways, leaving urban blight behind.

Nowadays “You could have Robert Moses come back from the dead and he wouldn’t be able to do shit,” complains Michael Skelly, a businessman quoted by Mr Dunkelman. Mr Skelly spent nearly a decade attempting to connect wind farms in Oklahoma to the Tennessee Valley grid, but was unable to do so despite the support of the Obama administration. That, abundance liberals would argue, reflects a colossal overcorrection from Moses’s time. Rules offering local communities vetoes on housing and infrastructure projects have tied the hands of governments and businesses, hindering efforts to tackle America’s housing shortage, speed up its transition to green energy and build high-speed rail.

Chart: The Economist

This diagnosis suggests that the Democrats should shift onto economic terrain more commonly associated with the political right. The first change would be to switch attention from the demand-side to the supply-side of the economy. Throughout the 2010s many progressives, including Mr Klein, complained that America’s economy was understimulated after the global financial crisis of 2007-09, hurting its recovery. Support for higher spending survived into the pandemic, when the Biden administration juiced the economy, stoking inflation, and then persisted as the deficit drifted above 6% of GDP in 2023. An abundance-pilled approach would instead focus on making supply inputs, such as energy, housing, transport and skilled workers, plentiful and cheap.

The second change—shifting from a focus on redistribution to one on growth—might be more difficult. Democrats have long sought to improve the lot of the downtrodden, whether they are poor, from an ethnic minority or suffering as a consequence of deindustrialisation. Notoriously, the Biden administration saddled its signature semiconductor initiative with fiddly requirements to favour minority-, veteran- and female-owned businesses. Now California is struggling to build a high-speed rail line in part because federal funding is tied to measures to tackle air pollution in poor communities. Abundance liberals are happy to forgo these sorts of policies: economic growth must first be secured before it can be redistributed.

Power, broken

Such an agenda would make America’s liberals more liberal in the British sense of the term. But there is one place where abundance types are woollier: on how far the state, rather than the market, should orchestrate economic growth. What animates them most is reviving the government’s ability to act. Messrs Klein and Thompson agonise about how the Biden administration sabotaged its industrial policy with red tape; Mr Dunkelman marvels at how the New Deal-era government built megaprojects like the Tennessee Valley Authority, a dam network still in operation.

Anxiety about Moses-like overreach is not the only reason to be cautious about such an approach. Insulated from competitive pressure, even the best-intentioned public bureaucracies have a habit of atrophying, as, for example, NASA has done in recent decades. And there are risks, too, in relying on a centralised bureaucracy when DOGE-style destruction will only ever be one election away. Ultimately, the right balance between a market- and state-led approach will differ from case to case: high-speed rail probably does require state direction, whereas the private sector can do the heavy lifting when it comes to homebuilding. Abundance liberals are correct to focus on the supply-side of the economy. The danger is that, in doing so, they replace bureaucratic kludge with overactive government. ■