Home United Kingdom Analysis | How the Post-Brexit U.S.-U.K. Trade Deal Lost Momentum

Analysis | How the Post-Brexit U.S.-U.K. Trade Deal Lost Momentum

Analysis | How the Post-Brexit U.S.-U.K. Trade Deal Lost Momentum

U.K. Prime Minister Boris Johnson, in carrying out his country’s split with the European Union, made big promises about securing a favorable trade agreement with the U.S. before the next U.K. general election in May 2024. The pace of progress has slowed with the transition of power in the U.S., and there’s still a lot of work to do. 

1. Why is this an important deal?

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One premise of Brexit was that the U.K. could make better trade deals for itself if no longer bound by the EU’s. “We hear that we’re first in line to do a great free trade deal with the United States,” Johnson told reporters in January 2017, visiting the U.S. as Donald Trump was preparing to take office. (Johnson at the time was U.K. foreign secretary.) One of the U.S. Republican senators he met with, Bob Corker, echoed that idea, saying a U.S.-U.K. deal would “be our priority.” Trump was an early supporter of Brexit and, as president, promised a “fantastic and big” trade deal with Johnson. For Trump, this was an early opportunity to repudiate his predecessor, Barack Obama, who had warned ahead of Britain’s 2016 Brexit referendum that the U.K. would be at the “back of the queue” for a trade deal if it decided to leave the EU.

2. So why didn’t it get done?

The two sides held five rounds of formal negotiations during Trump’s presidency and reported some progress. But sealing a deal before Trump asked voters for a second term in late 2020 was always an ambitious goal, not least because the U.K. and EU took years to work out the finer points of their post-divorce relationship. Now Trump’s successor, President Joe Biden, has other things on his front burner.

3. What is the U.K. position now?

Johnson remains keen for an agreement but acknowledges it won’t come easily or soon. He’s exploring the possibility of joining the U.S.-Mexico-Canada Agreement — the successor the North American Free Trade Agreement, or Nafta — although it’s unclear if there’s an avenue to do so. He’s secured some wins, including the U.S. decision to lift its longstanding ban on British beef, with lamb likely next in line.

4. What is the U.S. position? 

Biden hasn’t made trade with the U.K. an immediate priority for his administration. The White House remained tight-lipped about trade when laying out what was talked about between Biden and Johnson at a meeting in September. A deal with the U.K. “continues to be discussed,” Biden said. Biden hasn’t requested renewal of Trade Promotion Authority, legislation that enables the president to speed trade deals through Congress. And Biden has consistently underlined the importance of not allowing Brexit — which has turned the border between the Republic of Ireland and Northern Ireland into the demarcation between the U.K. and the EU — to put at risk the Good Friday Agreement of 1998, which ended the conflict in Northern Ireland.

5. What are the sticking points?

U.S. tariffs on steel and aluminum issued during the Trump administration are still in place, as are retaliatory tariffs imposed by the U.K. Chlorinated chicken has been a long-term source of strife between the countries: The EU banned chicken washed in chlorine in 1997 over concerns that the chemical may not be safe to ingest and is used to compensate for poor animal hygiene conditions, such as overcrowding. U.K. officials have promised to “hold the line” on their current food-safety rules, but they may consider letting products that don’t meet their standards in at a higher tariff rate. The two countries may want to pursue a long-term solution to a civil aircraft trade dispute that’s currently in a truce. The U.K. wants to resist granting full market access for U.S. pharmaceutical companies to sell drugs and medical devices, which had been a Trump administration goal.

6. What is the trading relationship between the U.S. and U.K.?

The U.S. was the top trading partner of the U.K. in 2020, and the U.K. was the fifth-largest partner of the U.S. The U.S. exported $121 billion in goods and services to the U.K. and imported $103 billion from the U.K. The U.K. estimated last year that a comprehensive agreement between Trump and Johnson would have boosted its gross domestic product by 0.16%, increased wages by 0.2% and saved the average household about 8 pounds ($10) per year.

Analysis | How the Post-Brexit U.S.-U.K. Trade Deal Lost Momentum – The Washington Post