The Office of the US Trade Representative (USTR) has released negotiating objectives in 24 areas for a potential trade deal with the United Kingdom, including plans to secure duty-free access for US textile and apparel products and improve competitive opportunities for the sector’s exports.
In its Summary of Specific Negotiating Objectives, USTR says as the first and fifth biggest global economies, the US economic relationship with the UK is “one of the largest and most complex in the world”, with annual two-way trade totaling more than US$230bn. Despite this, USTR says significant trade volume, multiple tariff, and non-tariff barriers have challenged US exporters in key sectors while the UK has been a member state of the EU and therefore a part of the common trade policy of the EU.
It adds the UK’s decision to leave the EU “creates a new opportunity to expand and deepen the US-UK trade relationship”, noting a new US-UK trade agreement could address these challenges, as well as provide an opportunity to develop new approaches to emerging trade areas where the United States and the UK share common interests and are global leaders, such as digital trade and financial services.
“Our aim in negotiations with the UK is to address both tariff and non-tariff barriers and to achieve fairer and deeper trade in a manner consistent with the objectives that Congress has set out.”
However, USTR notes that, while it may pursue negotiations with the UK in stages, it will only do so based on consultations with Congress.
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The Trump administration first notified Congress of its intention to negotiate a trade agreement with the UK, alongside separate agreements with the European Union and Japan, in October of last year.
Now, with regard to trade in goods, the US will seek to ensure “fair, balanced, and reciprocal” trade with the UK; increase transparency in import and export licensing procedures; and “discipline import and export monopolies to prevent trade distortions”.
On industrial goods, objectives include securing duty-free access for US textile and apparel products and seeking to improve competitive opportunities for exports of US textile and apparel products while taking into account US import sensitivities. Other goals include expanded market access for remanufactured goods exports and “greater regulatory compatibility to facilitate US exports”.
Meanwhile, on customs and trade facilitation, the US says it will seek to ensure that, to the greatest extent possible, shipments are released immediately after determining compliance with laws and regulations and provide for new disciplines on the timing of release, automation, and use of guarantees.
Additional objectives in this area include building on and setting high standards for implementation of WTO agreements involving trade facilitation and customs valuation, and increasing transparency by ensuring all customs laws, regulations, and procedures are published on the Internet as well as designating points of contact for questions from traders.
Other objectives include developing rules of origin that ensure the benefits of the agreement go to products genuinely made in the United States and the UK; establishing origin procedures that streamline the certification and verification of rules of origin and that promote strong enforcement, including with respect to textiles; UK initiatives to prohibit the importation of goods produced by forced labour; and a mechanism to take “appropriate action” if the UK negotiates a free-trade agreement with a non-market country, such as China.
David Henig, director of the UK Trade Policy Project at the European Centre for International Political Economy (ECIPE), a leading think tank on future UK trade policy, said: “This is very much a US-first set of negotiating objectives in line with President Trump’s approach to trade. There are no hints of any special treatment for the UK, and a number of areas which if agreed between UK and US would cause difficulties for the UK’s EU relationship. This has already led to criticism from UK civil society and MPs, and it is hard to see this as the basis for a future trade agreement.”
Earlier this week, when delivering President Trump’s 2019 Trade Policy Agenda to Congress, US Trade Representative Robert Lighthizer explained how, in the year ahead, the US will urge Congress to approve the new United States-Mexico-Canada Agreement (USMCA) and will launch new trade negotiations with Japan, the European Union, and the UK.
