As you’re reading the CWF blog, I’m assuming you’re in favour of free trade. But you may not be in favour of starting with Commonwealth countries. Here are six arguments why you should be:
1. It’s growing faster than almost anyone else:
Even excluding the UK, the Commonwealth’s GDP is already larger than the Eurozone and is predicted to overtake the EU in a few years’ time. Its current growth rate stands at nearly 5%, dwarfing the anaemic growth across many European countries.
2. It speaks, works, and thinks English:
1.23 billion Commonwealth citizens speak English to a reasonable level. Sharing a common language is estimated to boost trade between countries by over 40%.
But it’s not just speaking English that makes the Commonwealth such an attractive prospect. 30% of current UK exporters identified overseas regulation as a barrier to exporting more. When you consider that 82% of Commonwealth nations use at least a component of English Common Law, this seems far less of a barrier.
In fact, different legal origins are estimated to reduce trade by between 10-25%.
3. It’s already cheaper and easier:
A recent study found that Commonwealth nations already trade 25% more with each other than with non-member states and that trade costs are 19% lower.
This is hardly surprising when you consider that Commonwealth nations are ranked 1st and 3rd in “ease of doing business”, 1-4thin “starting a business”, 1st, 2nd, 4th, and 5th in “protecting investors”, and make up four out of only six countries that the Heritage Foundation ranks as “entirely economically free.”
4. The potential market is significant, growing, and youthful:
The Commonwealth already makes up a third of the global population and is expected to increase by nearly 30% by 2050.
However the potential market is not only growing and getting richer, it is also incredibly young with an ever burgeoning middle-class. In fact 63% of the Commonwealth is under 30 years old and one-in-twelve people alive today is an Indian under 27 years old.
5. It’s more connected than ever before:
If you’ve an HSBC branch recently you will have seen an advert proclaiming that “In the future, goods won’t be exported, they’ll be transmitted.”
This will only further advantage Commonwealth nations. 85% of home pages on the internet are in English, as is an estimated 55% of all internet content.
Commonwealth citizens also make up around 40% of Africa’s population but 53% of its internet users. In fact if you exclude Commonwealth countries, the continent’s internet access rate falls by around 50%.
Similarly, in South-East Asia, the Commonwealth nations’ internet penetration rate is 71.2%. The rate in non-Commonwealth countries in the region is just 16.7%.
6. It is connected to everyone else:
Finally, the Commonwealth is truly a network of networks. It has a member state in every continent, every inhabited time-zone, every political union, and almost every economic group or trade bloc. The Commonwealth can be Britain’s route to every corner of the globe.
To conclude, the Commonwealth may have its roots in Britain’s past but it should undoubtedly be a major part of our future.
Ralph Buckle is the director and co-founder of Commonwealth Exchange.
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