UK-US Trade Deal Negotiating Objectives — House of Lords, 2020-03-02
Topic: Foreign Trade
James Younger (Conservative, Centre-right): My Lords, with permission, I will now repeat a Statement made in the other place by my right honourable friend the Secretary of State for International Trade. The Statement is as follows: "Today my department is publishing a suite of documents that mark a crucial step in the process of beginning formal negotiations for a free trade agreement with our largest bilateral trading partner, the United States. These documents comprise the Government’s negotiating objectives, our response to the public consultation, and a scoping assessment to provide the House and the British people with analysis of the potential long-run economic impact of an FTA. These are available online and will be placed in the Libraries The UK stands at an historic moment, building its independent trade policy for the first time in almost half a century. This Government will seize this opportunity to be an independent, global champion with a simple message: free trade is good for all nations and will deliver benefits for businesses, households and consumers across the UK. We aim to have 80% of UK trade with countries covered by free trade agreements within three years, starting with the US, Japan, Australia and New Zealand. Seeking these agreements is part of our efforts to level up, deliver opportunity and unleash the potential of every part of our United Kingdom The USA is the world’s largest economy, our closest security and defence partner, and one of our oldest friends. We are the biggest investors in each other’s economies. An FTA represents a fantastic opportunity to strengthen and deepen our strong trade, investment and economic relationships, bringing us closer to the world’s economic powerhouse. In 2017, according to US statistics, 1.7 million people worked for US majority-owned companies operating in the UK, and 1.3 million for UK majority-owned companies based in the US. UK-US total trade was valued at £220.9 billion in the last year, representing 19.8% of all our exports. An ambitious FTA with the US could deliver a significant long-term boost for the economy. Compared with 2018, it could mean a £15.3 billion increase in bilateral trade and a £3.4 billion lift to the economy The negotiating objectives we are publishing today are underpinned by one of the biggest consultations ever undertaken with the UK public, businesses and wider society. It received the views of 158,720 respondents, all of which have fed into the Government’s broad approach to FTAs and specific negotiating objectives. We have scaled up our trade negotiator expertise and have a similar size of team to the US trade representative, including a wealth of experience from the private sector, trade law, Commonwealth nations and WTO experts, ready to deliver for the UK My department’s analysis shows that the US deal we are seeking benefits every region and nation of the UK, delivering improved access for businesses, more investment, better jobs and higher wages. For the Midlands, a UK-US FTA could reduce tariffs on cars and ceramics. For Scotland, it could lock in salmon and whisky trade and support new market access for beef. The north of England could see more exports of manufactured goods and new data agreements for its tech firms. The south-west can gain from eased customs procedures for beverages, luxury sports and marine equipment. The south-east could see benefits for its globally competitive professional business firms. London could see benefits through agreements on digital trade that will boost our world-leading tech firms. The east of England will see a boost to its food and life science industries. Wales stands to gain market access for its fantastic lamb, and reduced tariffs and red tape for its steel and ceramic sectors. Northern Ireland can benefit through liberalisation of tariffs in furniture and pharmaceuticals North, east, south and west, from agriculture to the creative industries, my department’s analysis finds that a US trade deal has the potential to deliver benefits throughout the UK economy, with more choice for consumers at lower prices and new opportunities for businesses, and to grow high-skills jobs. It has the potential to slash trade barriers and tariffs totalling some £493 million per year and could boost British workers’ wages by £1.8 billion Small and medium-sized businesses provide around three-fifths of jobs in the UK. They are increasingly international traders in their own right. In 2018, 97% of businesses exporting goods were SMEs, representing 28% of our total exports. Some 30,000 SMEs across the UK trade with the US already. So we will make it a priority in these negotiations to support UK SMEs to seize the opportunities of UK-US trade. We will do this by aiming to agree a dedicated SME chapter to facilitate co-operation on SME issues; to ensure that SMEs have easy access to information to take advantage of the new opportunities; to build on the successful UK-US SME dialogue to strengthen co-operation; and to ensure that throughout the agreement there are SME-friendly provisions covering both services and goods We are also looking to rewrite the rules of the game on digital trade to create a world-leading ecosystem that supports businesses of all sizes across the UK. This could include provisions that facilitate the free flow of data and prevent unjustified data localisation requirements, while ensuring that the UK’s high standards of personal data protection are maintained and that government continues to maintain its ability to protect users against online harm. We can ensure that customs duties are not imposed on electronic transmissions and create fantastic opportunities in areas such as blockchain, driverless cars and quantum technology In these trade talks, as in all our future trade talks, this Government will drive a hard bargain for the British people. The NHS, the price it pays for drugs and its services are not for sale. There will be no compromise on high environmental protection, animal welfare and food standards. Throughout these negotiations, the Government will continue to engage collaboratively with Parliament, the devolved Administrations and the public I can also assure the House that now the UK is free to negotiate outside the EU, we will be aiming to begin negotiations with the US as quickly as possible. The appetite is clear on both sides. We welcomed the US Government’s negotiating objectives, particularly on developing state-of-the-art provisions in financial services and digital trade. We welcome the enthusiasm in both the US Congress and the US Administration, as was made clear during my discussions last week with US Trade Representative Robert Lighthizer. We see in this not just an opportunity to deepen our bilateral trade and investment relationship, important though that is; it is about setting an example to the world of how two leading, open and mature economies can trade with one another As an independent trading nation, the UK will champion free trade and lower trade barriers at every opportunity. Striking free trade agreements will give our businesses the opportunities, certainty and security they need to prosper. The greatest opportunity to do this is with our closest ally and largest single trading partner, the United States. We have the mandate. We have the team. With the documents we are publishing today, we have the tools. With hard work, I believe we can get it done—so I commend this Statement to the House." My Lords, that concludes the Statement.