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Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.
The writer was one of the EU’s top trade negotiators and a former head of the EU delegation to the World Trade Organization and UN
As well as bringing significant elections around the world, 2024 will be a year of many international trade negotiations — the UK with the US and EU, the EU with India, US, Australia and others, China with Latin America, Africa with Europe and China? — as countries seek to diversify their trading arrangements.
Some agreements will be reached but there will also be failures and miscalculations. Trade negotiations are easy to start but hard to finish.
With that in mind, here are my 10 golden rules for any minister preparing to negotiate with the EU, US, China or anyone else.
First, apply the “Goldilocks” principle: ensure your negotiating mandate is neither too easy nor impossibly ambitious. If it’s too easy, you will be lazy and produce a poor agreement. Too ambitious and you will fail. Oh, and ensure your mandate gives you some wiggle room — don’t accept anything overly prescriptive.
Next, remember that, as my former boss and head of the WTO Pascal Lamy used to say, God is in the details (though you need the big picture too). Who can forget the famous photo of then UK Brexit secretary David Davis and Michel Barnier, the EU’s chief negotiator, opening the first round of Brexit negotiations? Barnier, a bulging well-tagged file before him, Davis with . . . nothing! Assuming he could wing it? The gifted amateur holding all the cards? He was wrong.
Third, keep your stakeholders happy. Another error of the British side in the Brexit negotiations was its failure to consult systematically its stakeholders — particularly parliament and business. The result? An agreement that both surprised and disappointed, and received scant support.
It is fatal to lose one’s constituency. Negotiators dub this the “champignons de Paris” approach — consign them to a dark cellar and shovel shit on them from time to time.
Contrast this with Barnier’s method: he drew EU member states into his confidence at every step, with two consequences. They trusted him even when he entered the “tunnel”, the secret stage of final negotiations where publicity can jeopardise the outcome. And the agreement contained few surprises so it got unanimous support from European decision makers.
Fourth, never lie: it will come back to bite you and you will lose forever your credibility as a negotiator. That does not mean you have to tell the whole truth — it’s not a court of law — so you can, as the UK Conservative politician Alan Clark once infamously put it, be “economical with the actualité”.
Fifth, regard the other side as your counterpart, not your enemy. You have both been tasked with solving a problem, so let’s help each other to solve it shall we? A fatal blunder of the UK negotiators was to regard the EU as the enemy. Be like Michael Jackson, a “lover not a fighter”.
Next, recall the Chinese saying “cross the river by feeling the stones”. In other words, don’t rush, play the long game. If you are in a hurry, your counterpart will smell blood and exploit it. Take your time, build your agreement piece by piece with patience. And for heaven’s sake never tell them what plane you have to catch.
Seventh, it doesn’t matter if the cat is black or white, provided it catches mice. More Chinese wisdom. Be flexible and pragmatic. From the outset identify “must haves” and things that can be jettisoned en route if necessary. Of course, pretend that it hurts to drop those points so as to get some payback for your flexibility.
Eighth, never get angry (unless it is carefully choreographed in advance), never raise your voice, wag your finger, and never walk out of the room. It doesn’t work.
Ninth, don’t forget that the most important moment in any negotiation is knowing when to stop. Recognise when you have got enough and it may not get better.
And finally, discard Abba’s advice: the winner doesn’t take it all. An agreement will only last if it benefits both sides. No zero-sum game, but “win-win” in the jargon. Former US president Donald Trump is a rare remaining proponent of this “I win, you lose, get it?” approach, first set out in his book The Art of the Deal. The problem is that it is doomed to failure. Look at his famous trade deal with China, now in tatters.
Inspired by the great Nigel Tufnel in the film This Is Spinal Tap, I offer an 11th commandment. Every negotiation is different, every negotiator different and has his or her own recipe. So be creative, be flexible, be reasonable, and enjoy yourself. I certainly did!
Source: Economy - ft.com
