US-UK trade deal progress discussed by Badenoch
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A trade deal between the UK and US was once hailed as a post-Brexit prize by MPs, but it now appears to be a distant prospect with President Joe Biden’s administration seemingly unwilling to make progress before the next presidential election. In September, a spokeswoman for then-Prime Minister Liz Truss said the UK is not immediately prioritising talks on a free trade deal with the United States.
Dr Peter Holmes, a fellow at the University of Sussex’s UK Trade Policy Observatory, told Express.co.uk the case that there will not be a UK-US trade deal in the foreseeable future is firmer than ever.
He said: “There’s not much that can be done. Biden is not keen on free trade agreements. Biden considers himself of Irish descent and thinks the British Government is causing serious problems in Northern Ireland. He takes the opposite line to the British.
“[The Government] could court opinion in Congress, but it’s difficult to see that there is a majority grouping in Congress that would be susceptible to blandishments by the British Government.”
Dr Holmes added neither Democrats nor Republicans would be interested in a comprehensive deal with Republican supporters of former President Donald Trump taking a protectionist stance over trade.
He said: “It’s difficult to see what argument you could use to get Trump supporters on board.”
Marco Forgione, Director of the Institute of Export and International Trade, told Express.co.uk: “I don’t think the priority is a comprehensive trade deal. It would be great to get it done, but the US is notoriously difficult to engage in free trade negotiations.
“What’s more important, and this is something the UK Government should be commended for, is the outreach to the states to work on a really clear programme of engagement – state by state, sector by sector, regulation by regulation – to enhance trade.
“The fact that we’ve got lamb now trading into the US is a tremendous success and a great testament to the talent and perseverance of our negotiators to get that done.
“The expectation we can secure more of those state by state Memoranda of Understanding is hugely positive. There is a great appetite in the US to secure trade arrangements between the states and the UK. The challenge we’ve got is the fact that weve got the hugely contested mid terms. Any discussions or negotiations on trade deals is on ice until the outcome of those.
“Then there will be a period of settling down as a result of those mid-terms. Then you’re looking at a Biden administration that is looking towards the end of its first term… A comprehensive trade deal with the US against that backdrop is really unlikely.”
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Mr Forgione added: “I think it would be wonderful to have a comprehensive free trade agreement with the US. I think it would be foolish for the UK Government to take that aspiration off the table, but in lieu of that being feasible or practical in the near term, the agreement state by state on trade collaboration is a really sensible route.”
Foreign Secretary James Cleverly said last month a trade deal with the US was always going to be complicated. He told Sky News: “You’ve got to remember that America is a big and very complex political environment, that individual states have a lot of autonomy. So doing an overall federal-level trade deal with America was always going to be complicated”.
In October, British lamb was exported to the USA for the first time in more than 20 years. The United States Department for Agriculture agreed to open the market for British lamb in 2021 with the first consignment flown to the USA last month containing lamb produced by Dunbia from its site in Carmarthenshire, Wales.
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Mr Forgione said: “It’s about the premium product that is produced in the UK and how that can be positioned in markets. There is demand for it – that Made in the UK, Sold to the World campaign is absolutely about building the sense of value and quality that comes from UK manufacturing and UK producers.”
Made in the UK, Sold to the World is the name of a Government campaign aimed at encouraging more businesses to export.
A Department for International Trade (DIT) spokesperson said: “We have a thriving trade relationship with the US worth over £230billion a year and American investment supports over a million jobs across the UK.
“Our transatlantic talks have removed barriers to trade, stopped harmful tariffs on UK steel and ended the 25-year ban on British lamb. We’ll continue working with the US at a state and federal level to unlock huge opportunities for businesses and boost collaboration on SMEs, supply chains and digital trade.”
International Trade Secretary Kemi Badenoch told Bloomberg in September it was unlikely a deal between the US and UK could be done in the short term, but she would be nurturing relationships so when it is time for a deal it will be a lot easier.
The United States has been the UK’s largest single investor over the last 20 years. In the past 11 years, foreign direct investment from the US has created more than 700,000 jobs across the UK, according to the DIT.
In the coming month, the Government is hoping to sign memorandums of understanding (MOU) with South Carolina and Oklahoma.
Dr Holmes said MOUs are not legally binding agreements and individual states can only strike deals covering a small number of areas without the US Government.
He added: “There are certain areas where the US Federal Government doesn’t have complete authority over rules at state level. So if you do a deal with with the US as a whole, there are still some areas in which you would have to an interest in talking directly to some of the individual states, particularly in government procurement.
“To sell British buses in Texas, you would need to secure agreement with the US in Washington, but also a separate deal with Texas. There are a small number of areas where states can strike deals without the US Government.
“There are two reasons why you can’t get much out of [state level MOUs]. They are not legally binding and state level authorities have very limited power over issues affecting trade.”
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