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Britain Goes for Front of the Line in US Trade Talks

  • Luis Ramirez

The United States and Britain launched preliminary talks Monday in Washington on a trade deal that will set up a new trade relationship between the two countries, after Britain’s exit from the European Union.

Britain hopes removing barriers under its current EU arrangement will boost trade with the United States by $40 billion by 2030.

No one is expecting these to be easy negotiations, but British trade officials said they are confident they had the support of the U.S. leadership, including the U.S. Congress, but especially of President Donald Trump.

The U.S. leader, speaking on the sidelines of the G-20 summit in Hamburg this month, said he wanted to move “very, very quickly” on a trade deal with Britain.

President Donald Trump speaks during the Women's Entrepreneurship Finance event at the G20 Summit, July 8, 2017, in Hamburg, Germany.
President Donald Trump speaks during the Women's Entrepreneurship Finance event at the G20 Summit, July 8, 2017, in Hamburg, Germany.

Britain is poised to secure a place at the front of the line on trade negotiations with the United States, just more than a year after then-President Barack Obama warned the British about the future trade relationship if they voted to leave the European Union. In remarks that stoked anger among pro-Brexit campaigners, Obama said Britain would go to the “back of the queue” on trade deals with the United States if the British voted to leave the European Union.

Free, open trading wanted

British Prime Minister Theresa May’s government hopes that Brexit and U.S. President Donald Trump’s America First policy can avoid the pitfalls of isolationism and protectionism.

“It is very important that we keep the United States orientated towards an open, free trading approach because it is the world's biggest economy and what happens there will affect everybody else,” British Trade Secretary Liam Fox said last week in Geneva. “So I think that directing the debate away from some of the protectionist noises into a free market, rules-based debate is a very important discussion for us to have.”

Fox led the British delegation on a two-day trip to Washington where he was to meet with U.S. Trade Representative Robert Lighthizer and other top U.S. officials.

The talks are only preliminary. Britain has no authority to enter trade agreements until it is completely out of the European Union, and that is two years away.

Domestic politics at forefront

But laying down the groundwork early is important not only practically, but politically, especially as the popularity of May’s leftist rival, Labour Party leader Jeremy Corbyn, grows and so do concerns that a U.S. trade deal may mean opening up Britain’s national health care system, the NHS, to U.S. firms.

FILE - Britain's Labor Party leader Jeremy Corbyn waves after arriving for the declaration at his constituency in London, June 9, 2017.
FILE - Britain's Labor Party leader Jeremy Corbyn waves after arriving for the declaration at his constituency in London, June 9, 2017.

“I am not sure that the British government is going to have the whole public opinion behind it in striking a trade deal with the United States,” said Angelos Chryssogelos, a European international politics professor at Kings College London. “It could get very, very controversial.”

For the British, agriculture is a major sticking point. Critics point to big differences between U.S. and British farming methods when it comes to the use of antibiotics and genetically modified crops, neither of which are welcome on British store shelves.

In the important financial services sector ties are already strong, and some believe a direct U.S. deal could mean more growth.

“When you are dealing with the E.U., you are dealing with a trade agreement (where) all these different pressure points come in from Italian wine makers to French cheese makers to German auto, and so any pure, for want of a better word, or direct agreement with the U.S. can sometimes be hostage with elements like that,” said Rob Misselbrook, head of Mylor Ventures, Ltd, a venture capital firm headquartered in southwestern England.

“Dealing on a direct basis, it is us and them. We speak the same language in many ways,” he said.

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