For the first time in 50 years, the UK has the power to set its own trade agenda. There is so much more we can do together!
This op-ed by Ambassador Johnson appeared in the June 12 issue of the the Daily Telegraph.
A trade deal between the US and UK will jumpstart growth
By Ambassador Robert Wood Johnson
11 June 2020
The unprecedented launch of virtual trade talks is a sign of how seriously both sides are taking this vital initiative
The United States and Britain are close business partners. We invest over a trillion dollars in each other’s economies. We create over a million jobs in each other’s countries. We do more than $300 billion a year in trade. But as vast as our economic partnership is, it can be so much stronger. Despite the close bond between our two countries, we are essentially trading together on the same basis as any two members of the WTO.
Fortunately, talks on a major U.S.-UK trade deal are now officially underway. Last month, US top trade negotiator, Robert Lighthizer, and British Trade Secretary, Liz Truss, made history with the first-ever online launch of trade talks with over a hundred negotiators on each side. This marks the first time the United States has ever conducted a comprehensive trade negotiation virtually – a mark of how seriously we take this initiative. On Monday those discussions will continue.
With our businesses feeling the pain of an unprecedented global economic challenge, now is not the time to take our foot off the gas. This is the moment to accelerate our efforts. Progress is happening at an unprecedented rate. Both sides have already committed to making sure our small and medium-sized enterprises – which make up 86 per cent of British companies that export goods and services to the US – can trade and invest more easily. Almost 30 different negotiating groups continue working around the clock to put together the blueprint for a comprehensive and ambitious deal.
The US and UK can do so much more together with a deal that sweeps away tariffs and removes the red tape our businesses currently face. If we can lower the amount it costs firms to export their products, thousands of goods made in the US will become accessible for British customers, and in return British products will become more attractive to US customers. While the costs of goods will be lowered, our trade provisions will uphold high standards for quality, environmental and labour protections, that ensure a level playing field.
For UK exporters, that could mean a huge boost to trade. If there is one market in the world which companies want privileged access to, it’s the United States. Trade deals don’t come bigger than that. The US is the biggest market in the world bar none. We import more than any other country – over $2.5 trillion worth of goods and services every year. The GDP of the US last year was larger than the GDP of the entire EU. And for Britain in particular, the US is by far your best market. Nearly 20 per cent of British exports go to the US – more than twice as much as you export to any other country. American customers spend around £264,000 on British goods and services every single minute.
While we can’t promise what the specific terms of an agreement might bring, analysis from the UK Government concludes that a US deal could bring benefits to people in every region in the UK, across all sectors of industry. Take agriculture. A deal could bring an enormous number of new customers to UK producers from the fishermen and whisky producers of Scotland, to the cheese and cider producers of the West Country, and to the lamb and dairy farmers of Wales and Northern Ireland.
Or what about all the advanced manufacturing bases across the UK’s industrial heartlands like the Midlands and the North East, whose local economies could be galvanised by a deal that reduces tariffs and cuts red tape? Then there is the UK’s world-leading service sector. From independent video game companies in Dundee, to tech start-ups in Brighton, or financial service firms across the country from London’s Square Mile, to Manchester, Belfast and Cardiff, a huge number of businesses could see big gains from ambitious US-UK commitments on digital technology and the free flow of data.
And for the UK as a whole, there are many other advantages to a trade deal with the US. We don’t ask our close trading partners to give up sovereignty over their national decisions as a price for doing business. We don’t attach a hefty price tag each year to be a member of our trade club.
For the first time in 50 years, the UK has the power to set its own trade agenda to suit the needs of the British economy. This is the moment we have all been waiting for. There is so much more we can do together, and the strong bonds between our countries will be more important than ever as we work together to resolve economic disruptions caused by Covid-19, and other challenges to the global economy. Now, at last, the countries known for our special relationship will have a very special trading relationship too.