Brexit heralds a new dawn for US-UK prosperity
Our free trade deal with the United States is on the horizon. Our exit from the European Union is approaching. We must ensure we Get Britain Out of the EU so we can make this future of enhanced prosperity a reality
As Shakespeare's Richard III put it: “Now is the winter of our discontent made glorious summer by this son of York”. If the Brexit episode, the Betrayal Deal, and the pulling of a meaningful vote has been our winter of discontent, then the glorious summer is our much-anticipated exit from the European Union on March 29th next year.
This glorious summer will occur in no small part because of our close and special relationship with the United States.
David Davis, the Former Brexit Secretary, and a wise and trusted mind of the British political system, believes firmly that the UK-US relationship is the brightest light at the end of our European tunnel.
Davis said: “If the US and UK can agree on a free trade agreement that pulls the UK out of the EU’s regulatory rotational orbit, this will be enormously beneficial.” These potential benefits need to be acted upon without delay. Both the UK and US stand to gain massively from a Free Trade Deal between them.
The UK’s five most significant exports to the US are: Medical and pharmaceutical products, £6.6 billion; Cars, £7.4 billion; Refined oil, £2.6 billion; Works of art, £2.7 billion; and Mechanical power generators £3.9 billion.
These figures will only increase when a free trade deal is concluded. Even in the interim the tariffs which we will establish under the World Trade Organisation rules will be substantially lower than those which are currently imposed. Thereby, it will become more profitable followed by vastly more profitable. There is also the significant possibility of negligible tariffs.
This will secure British jobs in our car industry and our oil refining industry. We should not give in to the fear-mongering of Britain being totally reliant on the EU market for our car part exports. There are global markets which are begging for skilled British car engineering. The is our global opportunity. We must prioritise increasing our trade with the United States as we begin to trade openly with the rest of the world.
Perhaps the most important elements of our UK-US relationship will be in Foreign Direct Investment (FDI). This means either establishing a business operation, or taking a controlling interest in one already up and running -- usually defined as a holding of 10% or more. For the UK, the US is the largest national source of FDI. The US is also the largest destination for FDI abroad by British Firms -- accounting for 15%.
This is vitally important for our relationship with the USA and for the future economic prosperity of the UK. US companies which invest in the UK are large employers and pay taxes to the UK economy. British companies which invest in the US market return the profits to Britain. Increasing Foreign Direct Investment in the UK has countless advantages: employment and economic boost; development of human capital; increased productivity; and easier international trade by incentivising the reduction of import tariffs.
It is not just the tangible benefits which are on show, but the timing is also perfectly suited for a full reignition of the ‘Special Relationship’.
The US administration is currently concluding the renegotiations of trade deals with Korea, Canada and Mexico. Then the focus will shift to a UK bilateral free trade agreement in the new year. The United States Ambassador to the United Kingdom, Woody Johnson, recently commented on the US’s “robust appetite” for a bilateral trade deal, which makes the launch of negotiations in late March 2019 a great opportunity.
On October 17th the Trump administration told Congress it wants to start trade talks “as soon as it is ready” after Brexit -- the Trump administration has always put the UK at the front of the queue for a trade deal -- which is sensational news.
It is a great change in fortune from the Obama administration, whose sour relations with the UK ensured we would not be near the top of any trade deal queue. Our current $230 billion annual trade with the US will increase massively. The UK is the US’s priority -- even while they seek separate deals with Japan and the EU, whilst fighting a trade war with China.
Brexit presents the UK with a unique opportunity to reshape our future and raise the quality of life for all British citizens. Economic growth through global trade is the key. The ‘Special Relationship’, forged by Churchill and Roosevelt, was not one between nations, but between common peoples with common values and common interests. The days when we cooperated and prospered together will return. As Roosevelt said to Churchill: “It’s fun to be in the same decade as you.”
Our recent political turmoil has epitomised the bleak midwinter of this winter of discontent. However, March -- the beginning of spring -- is the time when Britain will bloom into a new era of prosperity and independence. It is when we Get Britain Out.
To quote Shakespeare once again: “All the clouds that lour'd upon our house, in the deep bosom of the ocean buried. Now are our brows bound with victorious wreaths.”
Soon, our brows shall be bound with victorious wreaths. Our free trade deal with the United States is on the horizon. Our exit from the European Union is approaching. We must ensure we Get Britain Out of the EU so we can make this future of enhanced prosperity a reality.
Joel Casement is a Research Executive at the cross party, grassroots campaign Get Britain Out
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