US-UK trade talks begin, nearly four years after Brexit vote

Negotiators have come online, aiming to reach a Free Trade Agreement – but economists aren’t holding their breath.

US-UK trade talks begin - reuters
The UK's International Trade Secretary Liz Truss joins US Trade Representative Robert Lighthizer for a videoconference marking the start of trade talks [Andrew Parsons/10 Downing Street/Handout/Reuters]

A push for a trade deal between the United Kingdom and the United States has been on the cards since Brexiters made a convincing enough argument that membership in the European Union was holding the UK back from more profitable deals with potential trading partners around the world.

Nearly four years after a slim majority of Britons voted to depart the EU, the talks finally began – albeit by videoconference due to the near-global lockdown to curb the spread of the coronavirus pandemic – on Tuesday.

It is a busy time in London’s trade circles as the UK is simultaneously attempting to negotiate a deal with the EU, with a firm, self-imposed deadline of the end of the year for completion.

And even if coronavirus and an EU deal weren’t enough of a distraction, there are still significant obstacles to be surmounted in a potential UK-US agreement, say analysts.

“A trade agreement with the US has always been part of the Brexit project,” trade expert David Henig, the UK director of the European Centre For International Political Economy, told Al Jazeera.


“As such, this is about politics more than economic gains, which are likely to be minimal and may even be negative if a deal makes UK-EU trade harder. Reaching an agreement is not a certainty – UK sensitivities on US food and the [National Health Service] will be a problem, and if Trump loses the presidential election in November, we don’t know what a Biden presidency’s priorities would be.”

The UK’s Department for International Trade says its analysis shows a deal with the US would provide benefits across the country, with the greatest windfalls coming to Scotland, the northeast and the Midlands, while also including a dedicated chapter to help the UK’s 5.9 million small businesses.

“Increasing transatlantic trade can help our economies bounce back from the economic challenge posed by coronavirus,” UK International Trade Secretary Liz Truss said in a statement.

But it could be years before the details are finally hashed out. At the starting point in talks, the US wants full access to UK markets for its agricultural products, and minimal tariffs on the goods it wants to export to the UK, according to trade objectives published by Washington’s negotiators more than a year ago.

That could pose a problem – there is strong British opposition to US genetically modified crops and antibacterial treatments for poultry – “chlorinated chicken”, as it is described in UK media. Prime Minister Boris Johnson has promised to drive a “hard bargain”, and Truss has said that the UK would not reduce its food safety standards.

“The biggest hurdles the trade agreement will need to overcome are political,” former diplomat and trade negotiator Dmitry Grozoubinski told Al Jazeera.


“US farmers, bruised by the president’s trade war with China, will be pushing the Trump administration to demand far greater guaranteed access into the UK market than the UK will be comfortable providing. To get to a deal, one side of that equation has to change.”

Changing its regulatory standards to allow the import of US goods would knock the UK out of alignment with the EU, which could make getting a deal with the UK’s closest neighbours more difficult than it might otherwise be.

But that does not necessarily have to be the case, though British economists are not getting their hopes up about the overall gains to be had from a US trade deal.

“Our Brexit research suggests that the benefits of a trade deal with the US are pretty limited and will not compensate for the worsening of trade relations with the EU,” economist Garry Young, deputy director of the National Institute of Economic and Social Research, told Al Jazeera.

“I’m not sure that progress with the US would make negotiation with the EU any harder: EU negotiators already know that there is a risk that a UK-US deal could pose a threat to EU competitiveness.”

A Free Trade Agreement certainly has the potential to improve the business climate for some exporters, in some ways, some of the time - but the average citizen likely won't even notice it's there.

by Dmitry Grozoubinski, trade expert

The UK was the US’s fifth-largest goods export market and the seventh-largest supplier of imports in 2018, according to the office of the United States Trade Representative.


Trade between the US and UK came to an estimated $261.9bn in 2018, with $140.4bn of exports from the US and $121.5bn of imports from the UK.

The balance is such that neither country looks likely to unlock hidden riches through a new trading deal.

“Anyone expecting a free trade agreement to transform either economy is likely to be severely disappointed,” said Grozoubinski, now a visiting professor at the University of Strathclyde and the founder of

“The US and UK are some of the most open and liberalised economies in the world, with their remaining major trade barriers unassailable, politically entrenched and fiercely defended by activists and special interests. A free trade agreement certainly has the potential to improve the business climate for some exporters, in some ways, some of the time – but the average citizen likely won’t even notice it’s there.”

This first round of negotiations will last approximately two weeks and will involve around 100 negotiators on each side. Subsequent rounds are scheduled for approximately every six weeks – and will also be carried out by videoconference until border closures and lockdowns are lifted.

Source: Al Jazeera