U.S.-UK commence trade negotiations

On Tuesday, the United States and Britain launched trade negotiations through videoconferencing following the UK’s exit from the European Union. Both countries, struggling to cope with the coronavirus pandemic are aiming to shore up domestic supply chains.

These talks are Washington’s first major new trade negotiation this year and take place at a time when the UK is still working out its exit terms with the EU, with a looming year-end deadline.

U.S. Trade Representative Robert Lighthizer has kept his cards close to this vest, disclosing very little news of the trade negotiations. The U.S. has published a sweeping set of objectives more than a year ago that sought full access for U.S. agriculture products and reduced tariffs for U.S. manufactured goods.

The Trump Administration aims to shift supply chains back to the U.S., away from China, the source of the coronavirus, and is promoting a “Buy American” campaign for medical and other supplies.

Agriculture is expected to be a hornet’s nest given Britain’s strong opposition to U.S. genetically modified crops and antibacterial treatments for poultry. British Prime Minister Boris Johnson has vowed to drive a “hard bargain” and UK International Trade Secretary Liz Truss has said that Britain would not diminish its food safety standards.

On Monday, the U.S. Chamber of Commerce, the top U.S. business lobby, urged the two countries, which historically have been allies, to eliminate all tariffs, saying the move would be mutually beneficial for both countries in the long term.

According to the U.S. Chamber of Commerce, following successful trade negotiations, Washington and London could strengthen global trade rules to deal with challenges posed by non-market economies such as China.

In 2018, the value of trade between the United States and United Kingdom was valued at $127.1 billion, with the two sides roughly in balance; the trade in services topped $134.8 billion.

According to the U.S. Census Bureau, Britain is the Washington’s seventh-largest U.S. goods trading partner, after South Korea.

One low-hanging-fruit for tariff reduction is in automotive trade – Britain’s largest export sector to the U.S. The U.S. imposes a 2.5% tariff on passenger cars, while imposing tariffs of 25% on pickup trucks; Britain maintains a 10% tariff on cars.

“There are lots of areas — digital trade, visa liberalization, financial services — but if you can’t agree to essentially get rid of tariffs on visible trade, I’m not sure it’s a free trade agreement,” said Ted Bromund, a senior research fellow in Anglo-American relations at the Heritage Foundation, a conservative think-tank in Washington.

Truss sounded conciliatory in a statement released by Britain’s embassy in Washington on Monday.

“As we start trade talks with the US, we want to strike an ambitious deal that opens up new opportunities for our businesses, brings in more investment and creates better jobs for people across the whole of the UK,” said Truss.

Categories: Creativity, Economy & Finance, Entrepreneurship, Geopolitics, HR & Organization, Regulations & Legal, Strategy, Sustainability

Tags: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.

%d bloggers like this: