What a difference two months make.
On 23 June 2016, the British people exercised their democratic right and voted in a historic EU Referendum – IN or OUT of the EU.
The result was a shock, global markets reacted, the value of sterling fell.
But two months later things have settled down. The world has not ended and we are getting on with the job of dealing with our post-Brexit reality.
This is an opportunity for us to broaden and deepen our trade and investment relationship with Malaysia.
We do not underestimate the challenge ahead. But we will seize it, and we will make the best we can of this new reality.
So I want to explain where we stand and what we are doing about it.
First, Brexit means Brexit.
Second, we will make a success of it.
Third, Britain remains Britain.
Britain is a great country, thriving and prospering on the world stage.
Indeed we have just proved how globally competitive we are achieving second place in the medals table at the Rio Olympics.
No one should ever under-estimate us nor write us off. Nor doubt our resolve.
But, before I go into the detail of how we face our agenda ahead, I would like to remind you about who and what we are as a nation.
Britain remains a permanent member of the UN Security Council, NATO, the G7, the G20 and the Commonwealth.
Our voice is prominent on the world stage.
Britain is open for business, committed to peace and security, and a leading supporter of the international rules-based system.
Our commitment to our extensive security cooperation with international partners remains steadfast.
We are the only major country which will simultaneously meet the NATO target of spending 2% of our GDP on defence and the UN target of spending 0.7% of our GNI on development.
While our future relationship with the EU is still to be determined, we are not leaving Europe.
We are Europeans.
Our new Department for the Exit of Europe will negotiate what our new relationship with the EU will be.
We will want the strongest possible economic links with our European neighbours, but we also want them with our close friends in North America, the Commonwealth and other important partners around the world.
Indeed, Commonwealth Trade Ministers will meet in London early 2017 and we will want to work with them to see how we can further develop intra-Commonwealth trade and investment flows.
So we are very much on the front foot. Our ambition is clear.
We have our marching orders under Theresa May’s new Government.
We will be:
- more active,
- more outward facing,
- more energetic on the world stage than ever before.
We hold fast to a vision of a Britain that is respected abroad, tolerant at home, and here, let me be clear, Britain is not a racist country. It is an open, welcoming country.
I will not excuse the small minority who have behaved badly after the EU Referendum nor pretend that some ugly racism was seen. But our laws are clear, and from Prime Minister Theresa May down, we have said that there is no place for such attitudes in modern Britain.
We have laws against inciting racial or religious hatred and we will use them against those that do.
The Britain that I know is one that saw an Ipoh girl like me migrate to Britain and return to Malaysia, the country of my birth, to represent Britain as High Commissioner.
So our vision is one of a Britain engaged in the world and working with our international partners to advance prosperity and security for our people for generations to come.
The UK will continue to promote universal human rights as an integral part of building prosperity and stability around the world. Economic success is dependent on social capital and development.
Education – we recognise is a fundamental pillar to the endeavour.
And, education is a key pillar of our bilateral relationship with Malaysia. With five British university branch campuses here and dozens of British international schools, we are helping Malaysia to realise its ambition of becoming an education destination in Asia.
We have a new Education Is GREAT campaign celebrating our educational ties and working with Malaysia we want to take our joint offer pan-ASEAN over the next three to four years.
We will furthermore work through multilateral organisations, as well as bilaterally and with all like-minded partners to champion:
- human rights,
- democracy, and
- the rule of law, including the separation of powers and the need for robust institutions fundamental for any country’s true potential to be realised.
And, this is an important point – we have not yet left the EU. The British people have voted to leave and our Government are now seized on delivering that out. But, for now, we remain a member of the EU until we leave.
Let’s be clear about the process ahead.
First we must invoke Article 50 of the Lisbon Treaty. We then have a two year timetable in which to negotiate the terms of our new relationship with the EU.
Prime Minister Theresa May has made clear she will not invoke Article 50 till we are ready and that it will not be this year. If it is next year, then we are looking to a 2020 exit.
Before then we will continue to play a full and active role in the EU including supporting ongoing EU FTA negotiations with Malaysia and ASEAN.
Why? Because Britain believes in free trade and will both advocate it and champion it whilst we look to a future where, outside the EU, we will negotiate our own FTAs.
And we will start from a position of strength. We are working to ensure our economic fundamentals stay strong and become stronger still.
So let’s reflect on our track record and the foundations on which we will build.
Since 2010, as many as 300,000 new jobs have been created by companies that have chosen to locate in the UK.
Last year saw Britain achieve a record share of the EU’s foreign direct investment.
Why should a country that represents only 13% of the EU’s population succeed in getting 21% of the total investment?
The answer lies in strong underlying economic fundamentals.
In Britain, we have seen numbers in employment rise to an all-time high and unemployment fall to an 11-year low of below 5%.
These are the result of levels of growth that, even post Brexit, the International Monetary Fund (IMF) expects to be the highest in the EU.
We have a system of contractual law that gives investors the highest possible levels of confidence, overseen by an internationally respected and totally independent judiciary.
We have a skilled workforce and low levels of industrial disruption.
People rightly talk about London as an international financial and cultural powerhouse but how many people know that the north-east of England, as a region, now exports more cars than the whole of Italy?
And these are Nissan cars, made in the UK, because we have been open to foreign direct investment. Look at Jaguar Land Rover – iconic British brands - now owned by India’s Tata Motors.
We embraced foreign ownership but these remain British brands, with production up, driven by British design and innovation. We are exporting more cars to the world than we have ever done before because we were, and remain, open for business.
We have a low tax economy with some of the lowest business taxes in Europe and have one of the least regulated economies.
Our corporate tax rates are among the lowest in the G20 and are set to get even lower.
We have an internationally respected research base and some of the best universities in the world.
We are home to 18 of the world’s top 100 universities, and 4 of the top 10.
In areas such as financial services we have an unrivalled professional class able to give support.
We have the natural advantage of speaking English – the international language of business, of science, of diplomacy, even the official language of ASEAN.
We are in the perfect time zone for global trade – we can conclude business with China inthe morning and resume business with the US in the afternoon.
None of these elements is dependent on our membership of the EU.
And let’s not forget the quality of life issues that make living in the UK so attractive to those outside.
But what is important to realise is that investment is a two-way street.
We welcome foreign direct investment for the jobs it creates and the societies it transforms, but we must not forget that the UK is a significant global investor in its own right.
The top 20-24 UK companies in Malaysia employ about 80,000 people with total investment value just under RM90 billion. We want to build on this and we will.
UK investors are delivering new industries and helping to develop new sectors of business in Malaysia. Look at Dyson – 1,000 engineers, BAE Systems – 400 graduates working in Applied Intelligence. And think of the supply jobs created by these and more.
The kind of jobs that the younger generation Malaysians aspire to do – jobs driven by innovation and creativity.
Without open minds, questioning minds, the ability to express yourself and challenge perceived wisdom, there can be no creativity or innovation to drive the economy if minds are closed and restricted.
And, as I said earlier, we will continue to support free trade – we will play our part to encourage EU FTAs.
We will continue to support the Transatlantic Trade and Investment Partnership (TTIP) and Comprehensive Economic and Trade Agreement (CETA) and encourage an ever more liberal approach to the service sector, including financial services.
As we enter a new era, however, we need to take account of the changing patterns of trade across the globe.
We are moving away from an era when multilateral agreements dominated the landscape to one where bilateral free trade agreements (FTAs) and plurilateral agreements between small numbers of countries are becoming more common.
In the last 20 years, the number of free trade agreements in place has increased more than four-fold.
As we leave the European Union, the United Kingdom will want to play a full part in global trade liberalisation utilising all the tools and arrangements available.
Flexibility and agility will be the key to economic success in the 21st-century.
Leaving the EU gives us back control of our trade policy to set our own terms with the rest of the world. We are a Global Britain.
We will have the opportunity to make our tax systems even more competitive, take an axe to red tape that can hinder businesses, and shape a bright future for the UK as a beacon for open trade.
And in due course, we will set out a very ambitious programme of free trade areas (FTAs) with some of the most important and growing economies.
Clearly Malaysia takes its place in any prioritisation of countries for FTAs. We will not raise expectations now but we are clear about the process ahead and the possibilities beyond.
And, as we look to the future, we shall assess all the options on how best to develop our trading relations and what other mechanisms are also available.
And we will recruit and train many more trade experts so we are match fit to negotiate the best for Britain.
What will also continue is our dedication to providing market access to some of the world’s poorest economies.
And our ability to change external tariffs will enable us to help some of the world’s poorest countries to trade their way out of poverty.
A world of open trade will not only generate prosperity, but also peace and stability.
We can start afresh, and use our unique attributes to create a fairer, prosperous and more open trading future for the UK and the rest of the world.
The UK will remain a fantastic place with which to do business: investment will continue to flow and British goods will still adorn the supermarket shelves and homes of customers around the world.
We are open for business and we look to developing that with Malaysia in our new Brexit reality.