Nile Gardiner:
The visit by Liam Fox to Washington today will lay the foundations for a major post-brexit agreement
Liam Fox, the International Trade Secretary is in Washington today for the start of key talks with US officials laying the groundwork for a post-brexit trade deal with America. Fortunately for the British government, there is no bigger supporter of Brexit on the international stage than the leader of the world’s superpower. In President Trump’s own words, a US-UK free trade agreement will be “a very, very big deal, a very powerful deal, great for both countries and I think we will have that done very, very quickly”.
Donald Trump told Theresa May in January that Brexit “is a wonderful thing for your country”. And at the G20 Summit in Hamburg this month Trump emphatically rejected the ludicrous idea advanced by Barack Obama that Britain would be at “the back of the queue” for a trade agreement with the US.
I can say unequivocally that Trump’s wholehearted endorsement of a trade deal with Britain is enthusiastically echoed by leading Republicans on Capitol Hill, including Paul Ryan, Speaker of the House of Representatives, and Senators Ted Cruz, Tom Cotton and Mike Lee.
There is already real momentum in support of a trade arrangement between the world’s largest and fifth largest economies that could realistically be implemented within 90 days of Britain’s departure from the EU.
The US president is frequently caricatured as a protectionist. But the President is strongly in favour of bilateral trade deals that help create jobs in the United States, and boost the US economy. His opposition on the trade front has been reserved for big, multilateral deals such as the Transpacific Partnership (TPP). Much to the chagrin of Brussels, Britain is far more likely to get a trade deal with the United States before the supranational European Union does. The proposed US-EU Transatlantic Trade and Investment Partnership (TTIP) is, to all intents and purposes, dead in the water, and has little prospect of being implemented in the next few years.
Significantly, the United States already has in place 20 Free Trade Agreements with nations from Chile to Singapore. In contrast, the UK has not been allowed to negotiate a single trade deal on its own since it joined the European Economic Community in 1973.
Naturally, there will be concern among the British public that the United States, with vastly more experienced trade negotiators, and a GDP seven times that of Britain, will be at a distinct advantage in such bilateral talks, especially with the UK in such urgent need of trade deals when it leaves the EU’S Customs Union.
The White House must – and I think will – be sensitive to these concerns, and should be acutely aware that in order for a US-UK deal to work effectively, it has to be a good deal for both sides, one that creates wealth and economic opportunity for both, with a level playing field.
Washington and London should thus aim for a free trade deal that eliminates all tariff barriers between our two highly-developed economies, which have skilled workforces and comparable wage levels. The overriding goal of trade talks over the next two years must be to sign a deal as soon as Britain leaves the EU that makes it easier for Americans and Britons engaged in finance and commerce to work together.
It is firmly in the US interest to make this deal succeed. Britain is America’s largest services trading partner, in addition to being the biggest foreign direct investor in the United States, with a million American jobs dependent on British companies.
A US-UK free trade deal would ultimately strengthen the Special Relationship and demonstrate that the United States stands with Britain in the Brexit era. It would also be a powerful message to Europe and the world that Britain is back as a great sovereign trading power.
The US administration believes that Brexit will be a success, and that economic freedom and prosperity can flourish on both sides of the Atlantic in its wake. That is good news for Britain and all who support free trade.
Nile Gardiner is Director of the Margaret Thatcher Center for Freedom at The Heritage Foundation in Washington, DC