In his whirlwind visit to Europe, President Trump first told The Sun newspaper
that British Prime Minister Theresa May’s compromise on Brexit “killed”
the possibility of the U.S.-U.K. free trade agreement. Then, when he
stood next to the prime minister the next day, he said, “a great
bilateral trade agreement” was possible after all.
that British Prime Minister Theresa May’s compromise on Brexit “killed”
the possibility of the U.S.-U.K. free trade agreement. Then, when he
stood next to the prime minister the next day, he said, “a great
bilateral trade agreement” was possible after all.
If the United Kingdom does exit the European Union under the softer terms set out in the U.K. government’s white paper last
week, a free trade agreement (FTA) with the United States would not
only be possible but a positive step forward for the two nations and
their “special relationship.”
week, a free trade agreement (FTA) with the United States would not
only be possible but a positive step forward for the two nations and
their “special relationship.”
The
U.K. is on track to officially exit the EU in March 2019. During a
21-month implementation period after that, the U.S. and the U.K.
can negotiate, sign, and ratify an agreement that could go into effect as
early as Jan. 1, 2021, when the U.K. plans to exit the EU’s common external customs area.
U.K. is on track to officially exit the EU in March 2019. During a
21-month implementation period after that, the U.S. and the U.K.
can negotiate, sign, and ratify an agreement that could go into effect as
early as Jan. 1, 2021, when the U.K. plans to exit the EU’s common external customs area.
For
the U.K., an agreement with the United States would offer an
opportunity to throw off any remaining EU tariffs and to deepen its ties
to the world’s largest economy. For the United States, an agreement
would open doors further to the world’s fifth largest economy, its
closest ally in Europe, and its top foreign investment partner in terms of U.S. employment.
the U.K., an agreement with the United States would offer an
opportunity to throw off any remaining EU tariffs and to deepen its ties
to the world’s largest economy. For the United States, an agreement
would open doors further to the world’s fifth largest economy, its
closest ally in Europe, and its top foreign investment partner in terms of U.S. employment.
The
U.S.-U.K. relationship is not only special in terms of history,
language, and culture but commercially as well. While the U.K. ranks seventh in
the world in terms of its two-way goods trade with the United States,
it ranks no. 1 in services trade. U.K. residents are especially good
customers for such U.S. service exports as air freight transport,
financial services, movies and television programming, accounting and
legal services. Outside of North America, Britain is the top source of foreign tourists to the United States and the top destination for American tourists traveling overseas.
U.S.-U.K. relationship is not only special in terms of history,
language, and culture but commercially as well. While the U.K. ranks seventh in
the world in terms of its two-way goods trade with the United States,
it ranks no. 1 in services trade. U.K. residents are especially good
customers for such U.S. service exports as air freight transport,
financial services, movies and television programming, accounting and
legal services. Outside of North America, Britain is the top source of foreign tourists to the United States and the top destination for American tourists traveling overseas.
The
U.S.-U.K. commercial relationship is the deepest in foreign-direct
investment. Majority-owned U.K. affiliates in the United States
employed 1.14 million American
workers in 2015, according to the most recent numbers, more than any
other country. In the United Kingdom, U.S. majority-owned affiliates
employed 1.415 million workers in 2015 and accounted for 27 percent of all the FDI stock in the U.K., more than any other single country.
U.S.-U.K. commercial relationship is the deepest in foreign-direct
investment. Majority-owned U.K. affiliates in the United States
employed 1.14 million American
workers in 2015, according to the most recent numbers, more than any
other country. In the United Kingdom, U.S. majority-owned affiliates
employed 1.415 million workers in 2015 and accounted for 27 percent of all the FDI stock in the U.K., more than any other single country.
The
biggest opportunity for expanding trade will be for both nations to
repeal all remaining tariff barriers on trade in goods and to remove all
unnecessary regulations hampering the movement of goods, services,
investment capital, and people.
biggest opportunity for expanding trade will be for both nations to
repeal all remaining tariff barriers on trade in goods and to remove all
unnecessary regulations hampering the movement of goods, services,
investment capital, and people.
High
on the agenda of negotiators should be immediate elimination of all
duties on motor vehicles. U.S. passenger car exports to the U.K. now
face the EU duty of 10 percent and light trucks face a duty of 22 percent. U.K. exports of passenger cars to the U.S. are hit with a 2.5 percent duty and exported light trucks a 25 percent duty. A
duty-free zone could allow a deeper integration of the U.S.-U.K. auto
sectors, promoting more exports of U.S. cars and more choices for U.S.
consumers.
on the agenda of negotiators should be immediate elimination of all
duties on motor vehicles. U.S. passenger car exports to the U.K. now
face the EU duty of 10 percent and light trucks face a duty of 22 percent. U.K. exports of passenger cars to the U.S. are hit with a 2.5 percent duty and exported light trucks a 25 percent duty. A
duty-free zone could allow a deeper integration of the U.S.-U.K. auto
sectors, promoting more exports of U.S. cars and more choices for U.S.
consumers.
Also
high on the agenda should be eliminating all remaining duties on
agricultural products. The EU’s common external tariff schedule
averages 11 percent on imported farm products. The EU’s “Meursing
table” imposes especially high barriers on U.S. dairy exports. In turn,
the U.S. should eliminate all barriers to such U.K. farm products as beef,
veal, lamb, mutton, cheese, and butter. The agreement should seek the
mutual recognition of food safety standards. Each nation should be free
to regulate products to protect public health and safety, but any such
regulations should be based on sound science, not the protection of
special interests.
high on the agenda should be eliminating all remaining duties on
agricultural products. The EU’s common external tariff schedule
averages 11 percent on imported farm products. The EU’s “Meursing
table” imposes especially high barriers on U.S. dairy exports. In turn,
the U.S. should eliminate all barriers to such U.K. farm products as beef,
veal, lamb, mutton, cheese, and butter. The agreement should seek the
mutual recognition of food safety standards. Each nation should be free
to regulate products to protect public health and safety, but any such
regulations should be based on sound science, not the protection of
special interests.
A
U.S.-U.K. FTA should also guarantee the free flow of data, the freedom
to locate servers abroad, and the complete liberalization of content for
television, movies, and audiovisual services. Concerns over Internet
privacy should be addressed in less burdensome ways than the EU’s
draconian General Data Protection Regulation.
U.S.-U.K. FTA should also guarantee the free flow of data, the freedom
to locate servers abroad, and the complete liberalization of content for
television, movies, and audiovisual services. Concerns over Internet
privacy should be addressed in less burdensome ways than the EU’s
draconian General Data Protection Regulation.
Other
opportunities for a U.S.-U.K. FTA include deeper integration of
financial services, especially when the two nations include the world’s
two most important financial centers, New York and London. An ambitious
agreement would also curb or eliminate restrictions in inter-coastal
shipping, domestic airline sabotage, and media ownership. Both nations
should commit themselves to open, competitive government procurement.
opportunities for a U.S.-U.K. FTA include deeper integration of
financial services, especially when the two nations include the world’s
two most important financial centers, New York and London. An ambitious
agreement would also curb or eliminate restrictions in inter-coastal
shipping, domestic airline sabotage, and media ownership. Both nations
should commit themselves to open, competitive government procurement.
With
tensions and tariffs rising between the United States and its major
trading partners, an agreement with a post-Brexit United Kingdom would
be a welcome change in the direction of free trade. It would offer a
great opportunity for Congress and the Trump administration to work
together along with a key U.S. ally to promote more trade, economic
freedom, and prosperity.
tensions and tariffs rising between the United States and its major
trading partners, an agreement with a post-Brexit United Kingdom would
be a welcome change in the direction of free trade. It would offer a
great opportunity for Congress and the Trump administration to work
together along with a key U.S. ally to promote more trade, economic
freedom, and prosperity.
