The UK is signing its first US state trade memorandum of understanding with Indiana and the Department for International Trade expects around eight more to be agreed soon.
Trade minister Penny Mordaunt, who has been lobbying for the state-level deals, said: “Our state-level strategy is paying off and this is just the first of many agreements we’ll be signing in the future as we look to bolster our £200bn trading relationship with the US.”
Ministers are hailing the tie-up with the 17th-largest US state by population size as “a major milestone” from which businesses will “start reaping the rewards”. Talks are underway with around 20 other states.
The government announced that the MoU creates a framework to remove barriers to trade and investment, paving the way for UK and Indianan businesses to invest, export, expand and create jobs.
Export opportunities
Indiana offers UK firms significant opportunities in areas like renewable energy, advanced manufacturing and pharmaceuticals, the government said.
The UK is the seventh largest export market for Indiana, and the state currently buys $1.4 billion-worth of goods from the UK.
Although the Indiana deal is just a memorandum of understanding, Politico describes it as something of a political win for Mordaunt, as the UK builds momentum to a US-wide free trade agreement with US president Joe Biden’s administration.
Business collaboration
The agreement will look to improve procurement processes and strengthen academic and research ties, enabling academics and businesses to collaborate.
It also aims to promote mutual professional equivalence, so that workers from the UK and US have their professional qualifications recognised on both sides of the Atlantic.
Writing in the Express, Mordaunt said the deals were part of a pattern of success for the UK as it uses its new freedoms from the EU.
“We are championing trade as a force for good in the world. We are arguing for regulation based on adequacy and equivalence as opposed to harmonisation.”
FTA side-lined
Britain’s state-level strategy is being pursued after president Biden made it clear that a US-UK free trade agreement is off the table, reports the Independent.
Biden’s administration has not been keen to sign new trade deals, although the UK has had some successes in removing tariffs from steel exports and lamb.
The UK and US have also commenced a series of transatlantic dialogues to address pressing challenges including congested supply chains and climate change, as previously covered in the IOE&IT’s Daily Update.
