UKDIT’s Truss on New Security, Maritime Strategies, Type 31, Brexit, US Trade Deal

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Rt. Hon, Liz Truss, MP, secretary of the UK Department of International Trade, discusses her new security and maritime exports strategies, the government’s decision to award the Type 31 contract to Babcock, investment to ensure future export success, Brexit impact and a US trade deal with Defense & Aerospace Report Editor Vago Muradian at the DSEI conference and tradeshow in London. Our coverage is sponsored by L3 Harris and Leonardo DRS and in partnership with Clarion Events — DSEI’s organizer — and working with the UK Department of International Trade’s Defence & Security Organisation to bring our audience the best in British defense.

Vago Muradian:  Welcome to the Defense and Aerospace Report.  I’m Vago Muradian here at the Excel Center in London to cover the 20thAnniversary edition of DSEI, one of the world’s truly great defense and security exhibitions.  Our coverage here is sponsored by L3Harris and Leonardo DRS, and we’re partnered with Clarion Events, the organizer of this great event that also puts on a number of other flagship exhibitions around the world, and we are working with the UK Department of International Trade, Defence and Security Organization to bring you the very best of British defense.

As part of doing that, it’s our absolute honor to talk to the Secretary of the Department of International Trade, Liz Truss,  a member of Parliament from [Burrick].  Thank you so much for spending some time with us.

Right Honorable Liz Truss:  It’s great to be here this afternoon.  It’s a fantastic event that we’re at.  Delegations from all around the world, because the UK does lead in terms of defense and security exports.  I think the attendance this year just shows how important it is to the future of UK’s exports.

Mr. Muradian: In part of doing that, there are a variety of strategies you’ve already rolled out.  One of them is the Security Export Strategy.  The other is the Maritime Five-Year Export Plan.

Talk to us about both of those and what they mean.

Secretary Truss:  Well on security, we are currently fourth in the world in terms of security experts, but we have huge expertise in this area.  We have world-leading products.  What we want to do, we’ve already almost doubled our exports since 2012.  What we want to do is expand that further, give more support to the industry and the Security Export Strategy is all about how we do that.  There’s 150 billion worth of business across the world that we can get our hands on.  I’m really excited about that opportunity.

Mr. Muradian:  That’s right, because you posted extraordinary figures of 19 billion in defense and security.  I mean it’s a little bit of a one-off because of the warship orders in there, but is that a pace you think you can sustain given that Mark Goldsack has been working overtime in order to deliver that number?

Secretary Truss:  Absolutely.  There are lots of new opportunities coming up.  The Prime Minister will be making an announcement or has made an announcement on the Type 31.  Not only do we want to build those ships in the UK for UK use, we also want to be exporting those internationally.  We’re having a lot of interest in those battle types.  We’ve already had successes in the Type 26 with countries like Australia and Canada.  So we think there are lots of prospects for more maritime orders in particular from our defense industry.

Mr. Muradian:  That’s right, and that’s a door opener also, isn’t it, to all the other systems that would go on those ships through the life of those ships.

Secretary Truss:  Absolutely.  It’s a fantastic platform for our products.

Security is increasingly important across the world, and Britain is a trusted brand.  We are a trusted producer of high-quality products. What you see at this show is really truly world-leading products, whether it’s in the shipping area, whether it’s in aircraft, whether it’s in land use.  And I, as Secretary of State for Trade, I’m determined to go out and get more of those products sold to our international allies.  Next week I’ll be in Australia and New Zealand, and of course this will be one of the things on the agenda.

Mr. Muradian:  Let me ask you about investment, though.  That export success is built on the backs of decades of investment, technological expertise, British were the lead in engineering.  Obviously a big focus on building up skills.  We’ve heard that from every leader that we’ve talked to.

Talk to us a little bit about the investment strategy you have to ensure that Britain remains in the lead so that ten years from now you’re as strong as you are in defense and in aerospace.  Where are the investment priorities?

Secretary Truss:  Well as you have seen from last week’s spending round, additional money was put into our defense budget but also into our skills budget, making sure that we’re bringing through the next generation of young people with skills in areas like STEM that we need to maintain our high value products.

The Prime Minister announcing a new set of Type 31s, those are very high-tech vessels that are going to be available on the world market.

Mr. Muradian:  Let me ask you about the three percent increase.  You have a three percent increase in your budget, which the timing of it is pretty fortuitous, given some of the other things which I’ll ask you about in a minute.  I can’t do an interview and not ask about Brexit, unfortunately.

Talk to us about how that three percent is going to be spent.

Secretary Truss:  Well, we’re going to be spending it on a variety of areas.  First of all, striking new free trade agreements across the world.  That is a huge priority as part of our Brexit strategy.  We’ll be looking at countries like the U.S., Australia, New Zealand, Japan.

But also making sure we’re promoting what Britain has to offer.  We’re going to be relaunching our Global Britain Campaign.  It’s going to show a new confident, assertive Britain which I think will encourage more investors to put their faith in the UK.

Mr. Muradian:  Brexit is still ongoing.  Is there any concern on your part that a rough process could potentially reduce opportunities for you in Europe?  Some of your closest friends and allies?

Secretary Truss:  I think you can see from today’s show that business is booming here in Britain. That people want to see what we have to offer as a country.  We have a huge range of opportunities.

My view is that it’s vital that we leave the European Union on the 31stof October.  What is worse for business is limbo.  What people want is a sense of the way we’re moving forward.  We’ve been very clear, we want to get a good trade deal with the EU, but we don’t want to be in regulatory alignment with the EU.  That will enable us to do more trade with the rest of the world.

So yes, we want a good free trade agreement with the EU but also with the rest of the world. What we can’t have is more waiting in limbo and delay.

Mr. Muradian:  So is part of the strategy if there’s a drop in Europe you’ll make it up elsewhere in the world?  If there are a little bit of hard feelings and they end up impacting the trade relationship?

Secretary Truss:  Well, I want more trade with Europe and more trade with the rest of the world.  We can do both.  We are a country that has strong links, of course, to Europe, but we also have strong links with the Commonwealth, with the U.S., with all countries across the world, and I think we can do more business and more trade with them.

What we’re working on as the Department of International Trade, is getting more of our small and medium sized enterprises out there, ready to trade.

Mr. Muradian:  Let me ask one last question.  Obviously a trade deal with the United States is a priority.  The Prime Minister talked about it, the American President has talked about it.  What is the kind of trade deal you want to forget with the United States at the end of the day?

Secretary Truss:   A trade deal with the U.S. is a huge opportunity.  Of course the UK won’t be a pushover.  We’ll be tough negotiators.  But I think there is a great deal to be done.

What I  would like to see as a comprehensive deal, because we are two of the most high-tech countries in the world, we’re here at the Defense and Security Show talking about the level of expertise in those areas. So what I want to see is a comprehensive deal that really reflects the strength and the links between our two great economies.

Mr. Muradian:  And beefing up particularly on defense and aerospace?

Secretary Truss:  That will absolutely be a part of it.

Mr. Muradian:  Liz Truss, the Secretary of the Department of International Trade.  Thank you so much for the opportunity.

Secretary Truss:  Very nice to meet you.

Mr. Muradian:  Very good meeting you.  Best of luck in the process and everything that’s to come.

Secretary Truss:  Thank you.  Thank you very much.  Great to see you.

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