Published: 6 October 2023
Is There Time for a ‘Foundational’ Trade Agreement Before the Next Elections?
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Rumors published this week by Politico that the US and UK are going to try to fast track some form of ‘foundational’ trade agreement before the elections in both countries at the end of 2024 should be cautiously welcomed by BAB members. With no confirmed details available at the time of writing this note, my prevailing instinct is to be positive about anything that meaningfully moves the trade agenda along after a frustrating period. The story suggests that teams from both countries will work rapidly over the next 6 to 8 months to get a shortened agreement finalized before the work has to be suspended for the elections But with traditional market access liberalization and tariff reduction apparently not included there is a real question about whether such an agreement would have any material effect in the real world for businesses or is more about advertising climate and labor market principles for domestic political purposes.
There are also a lot of other things going on; the Atlantic Declaration, signed just back in June, has around 20 concrete objectives that both governments have committed to work on. As I have said before, if all of these can be agreed, the Declaration has the potential to be a transformational agreement, but the work needed to get each of these delivered is extensive and complicated. The news that a US-UK Data Bridge has finally been agreed is extremely welcome but this was just one of many objectives which the negotiating teams from both sides will need to work their way through.
And then there are the State MoUs, now numbering six agreements with Washington State just added in September. Each of these agreements has the potential to lead to new business opportunities for the states involved and for the UK. But this will only happen if the follow up is in place with agreement by agreement planning for trade missions and delegations going both ways across the Atlantic, instigated by trade promotion teams and made available to businesses.
To be clear, BAB has been a supporter of all of these initiatives and will continue to cheer anything that is designed to make it easier and less expensive for companies to operate across the two markets; we just hope that the work doesn’t end up half finished.
In the end, private enterprises of all sizes will continue to make their decisions based on the opportunities and risks that they see before them. Fundamentals like language, culture, market size, judicial fairness, availability of capital, reasonable levels of tax and regulation are the most influential factors driving the macro investment and trade trends and although there have been some recent bumps, these remain positive for both markets, especially when looked at relative to the geographic alternatives. So we will certainly cheer on the negotiators and do all we can to help the process, but our main focus will be on these fundamental principles that reassure boards and CEOs that the UK and US are good places to invest.
In this spirit, we encourage everyone to take note of BAB’s 2023/24 Policy Agenda, launched last month at events in Washington DC and London, that covers all the aforementioned issues and more. We will be working on these issues over the coming months and we encourage our members with concerns or ideas to get in touch with Emanuel Adam our public policy lead.
Also last month, we convened our Advisory Board for dinner at Deloitte in London with guest speakers David Cameron and Bob Zoellick for a fascinating discussion brilliantly moderated by our new Advisory Board Chair, Sir Alan Parker of Brunswick Group. And a highlight for me was the excellent fireside chat with United Airlines CEO, Scott Kirby with Brandpie founder, Dave Allen as part of our Power of Purpose series. If you missed it live, you can watch the recording here.
October will be just as busy with lots of opportunities for members to get involved. You can see a constantly updated list of forthcoming events on our website here. Our AGM is on October 24th and we will continue to run this as a virtual event to which all members are welcome. You can see the details and register to attend by following the links here. I hope to see you then or somewhere in between.