British businesswoman Rona Fairhead has enjoyed an impressive career that’s included serving as general manager for U.K. operations at Bombardier Inc., overseeing the BBC, running the Financial Times Group and sitting on the boards of HSBC and PepsiCo. She has also survived breast cancer, earned a pilot’s licence and became a baroness last year when she was appointed to the House of Lords.
Now, she’s facing what could be her biggest challenge yet: helping Britain secure trade deals after it leaves the European Union in March. That’s no easy task, considering Britain hasn’t managed its own trade relations for more than 40 years because the EU negotiates all trade deals on behalf of member states.
Prime Minister Theresa May recruited Lady Fairhead into the government last year as the Minister of State for Trade and Export Promotion, hoping to bring some business acumen to the fledgling Department for International Trade. And while she receives no salary for her work, Lady Fairhead has been travelling the globe in search of trading opportunities post-Brexit. “I’ve never worked harder in my life,” she said in a recent interview in her spacious office in a corner of the Foreign and Commonwealth Office, just across from 10 Downing St.
Lady Fairhead, 57, is one of three ministers who work with the Secretary of State for International Trade, Liam Fox, and she’s been keen to make Canada a top priority for the department. “We have so much in common with Canada,” she said. The department’s plan after Brexit is to immediately turn the Canada-EU trade deal, known as the Comprehensive Economic and Trade Agreement, into a Canada-Britain deal. Lady Fairhead is a big fan of CETA and rattles off a list of statistics to prove its benefits, including figures produced by the department that show Canada’s gross domestic product increasing by £2.6-billion ($4.4-billion) a year in the long run as a result of the agreement. And she’s convinced it can be the basis for a Canada-Britain agreement.
There are pitfalls. CETA took more than seven years to negotiate and it doesn’t cover much of the agricultural sector or financial services, which are both important to Canada and Britain. The treaty’s dispute resolution mechanism has also been controversial and it has yet to be ratified by all EU member states. Lady Fairhead acknowledged the challenges and said there would have to be a multistage process. “Job one is to look at rolling [CETA] over and then what we will do in future is look to what further things can be done,” she said. The EU has more than 40 other trade agreements that Britain is considering rolling into bilateral deals too, meaning the department simply doesn’t have time to negotiate each one individually before Brexit, she added. “The aim is that no matter what form Brexit takes, continuity exists for business,” she said.
Lady Fairhead is drawn to Canada as a priority in part because of the five years she spent at Montreal-based Bombardier under the watchful eye of long-time chief executive Laurent Beaudoin. She joined the company in 1991 shortly after it bought Belfast-based Short Brothers and eventually ran Bombardier’s British aerospace operation. “It was my first corporate job and it was probably the best grounding I could have hoped for,” she said. Mr. Beaudoin “made things real,” she added. “You’d sit there as an executive proposing a capital expenditure and he’d sort of listen and then he’d put his hands in his pocket and jingle the coins and he’d say, ‘So Rona are you telling me that if I invest $100 today of our company’s money you are confident that I will have $125 in [a certain period]?’ And he’d look straight at you and you’d realize it wasn’t silly money. It was real and it was somebody’s pocket that it was going to go into.”
She’ll need all of that experience and more once Britain leaves the EU on March 29, 2019. Britain has virtually no experience negotiating trade agreements and the government can’t even start discussions with any country until it formally leaves the bloc. It’s also unclear what form Brexit will take. Talks between Britain and the EU over a framework for future relations on trade and other matters have deadlocked, raising the prospect Britain will leave without a deal. That’s a concern for many business leaders who worry that without a deal, Britain will face stiff tariff and non-tariff barriers from the EU, the country’s biggest trading partner. And even if Ms. May reaches a deal, it’s not certain Britain will have total freedom to negotiate trade agreements because under the Prime Minister’s Brexit strategy, the country could remain wedded to EU rules and regulations to ensure the free flow of goods. That could hamper trade negotiations with other countries including Canada because Britain wouldn’t be able to stray from EU rules.
“There’s a lot of uncertainty,” Lady Fairhead acknowledged. “It’s a negotiation and you can expect lots of bumps, lots of noise.” But she remains confident Ms. May will strike a deal with the EU. “A no deal is frankly in absolutely no one’s interest,” she said.