The UK’s negotiations for a free trade agreement with the US, which began this week via video link, have a particular focus on small businesses that are seeking beneficial terms in exporting to America.
The two countries are already trade partners, with the US being the UK’s biggest single-country export destination, while the UK is America’s fifth largest export market. In particular, the UK is seeking lower tariffs on agricultural exports.
At the same time, the UK is negotiating with the EU on a possible trade deal with the bloc that has been the UK’s biggest overall export destination.
The overall thrust of the talks, which some US sceptics believe will only start to deliver benefits for the UK in November, is on lifting the estimated £450m tariffs the US currently imposes on UK exports, including those in agriculture and manufactured goods.
SME focus
Small businesses, called MSMEs (micros and small-to-medium sized businesses), were highlighted in the UK government’s note on its negotiating objectives, published in March before talks began.
Financial and digital services sectors also had dedicated chapters in the document.
The chapter on small businesses, some 30,000 of which already export to the US, includes measures to facilitate easier customs procedures for sectors include services and telecoms.
“It’s particularly encouraging that the government has included a special chapter on small business trade as part of the overall trade agreement with the US,” said Marco Forgione, director general of the IOE&IT.
He said the Institute was “looking forward to providing the support, advice and training to help UK-based MSMEs achieve their potential to be the driving force of UK exports.”
The video talks, involving some 100 officials on either side, will be held every fortnight remotely until lockdown measures ease.
In March, international trade minister Liz Truss said the UK was aiming to have 80% of UK trade covered by free trade agreements within three years, “starting with the EU, the US, Japan, Australia and New Zealand. Seeking these agreements is key to our efforts to level up, deliver opportunity and unleash the potential of every part of the United Kingdom”.
New minister
The talks began on Tuesday, 5 May in the same week as the DIT announced the appointment of a new Minister for International Trade, Ranil Jayawardena, MP for North East Hampshire since May 2015 and deputy chairman of the Conservative Party since 2020.
“We welcome the new minister at a time when crucial talks are taking place with the US and the EU, to ensure that international trade will play a vital role in helping the UK economy rebound from the COVID-19 lockdown and in reshaping the UK economy at the end of the transition period,” said the IOE&IT’s Marco Forgione.