The problem with a UK-US trade deal

Once hailed as one of Brexit’s great prizes, Liz Truss has now conceded a free trade deal with the US will not be struck any time soon.

As the prime minister flew to New York on the first foreign trip of her premiership, she admitted that trade talks with the US would not start even in the “medium term”.

It is news “likely to disappoint Brexiters”, said The Guardian, as Truss “downplayed expectations” of an imminent trade deal “amid concerns that overpromising but then failing to get talks off the ground would damage her nascent administration”.

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The paper noted that it was “the first time” the government had admitted that there was “virtually no chance” of striking an early bilateral trade deal with the US, “despite it being coveted by Brexit supporters as one of the major potential benefits of leaving the EU”.

Speaking to reporters on the plane to New York for the United Nations General Assembly, Truss admitted: “There aren’t currently any negotiations taking place with the US and I don’t have any expectation that those are going to start in the short to medium term.”

Instead, the prime minister said her priorities for trade were striking deals with India, the Gulf States and joining the trans-Pacific trading partnership of 11 countries, including Australia, Canada and Singapore.

She added that the “number one” focus of her talks with President Biden at the UN on Wednesday would be “global security and making sure that we are able to collectively deal with Russian aggression and ensure that Ukraine prevails”.

Biden in ‘no hurry’ to strike deals

In her role as international trade secretary in Boris Johnson’s administration, Truss was responsible for “preparing the ground” for a US-UK trade deal once the UK left the European Union, said The Times.

While the Department for International Trade made some headway, publishing 184 pages of negotiating objectives in March 2020 before beginning talks in May, there was little progress “in the most contentious areas such as agriculture”, said the paper. And “any remaining momentum behind a deal dissipated” after Biden succeeded Donald Trump in January 2021.

Truss’s “downbeat comments” on a trade deal reflect the fact that Biden and the US Congress “are in no hurry to conclude a trade deal with Britain”, said the Financial Times.

Biden’s discomfort with the UK’s approach to post-Brexit trading arrangements in Northern Ireland is likely to have further endangered the prospect of a free trade deal, the paper added. Indeed, “some Democrats have warned the UK that there can be no trade deal unless the matter is resolved”.

Undoing Northern Ireland Protocol not ‘conducive’

Earlier this month, the White House press secretary Karine Jean-Pierre said that while there is “no formal linkage” between the potential for a bilateral trade agreement and the Northern Ireland Protocol, any attempt by the UK government to rip up existing post-Brexit trading arrangements “would not create a conducive environment, and that’s basically where we are with the dialogue”.

Government sources have accused the US of trying to use the threat of calling off trade talks as a “sword of Damocles”, with which it could pressure the UK government to give way on its position on the protocol, said The Daily Telegraph. But by “making it clear” that Truss does not believe a trade deal is likely in the near future, the government “believes this will lessen the impact of any US threats”, said the paper.

Although the UK will not be able to make a trade deal with the US on a country-wide level for years, Truss’s aides have pointed to state-level trade deals already struck. But these so far “number only two: Indiana and North Carolina”, said Politico, “while a strategic partnership compact has been signed with the state of Georgia”.