Covid-19 has had a devastating impact on every aspect of our lives, but it has shown how resilient we are as a country too. Within weeks, the government managed to set up schemes to keep businesses afloat and provide employees with financial certainty. This has involved departments working around the clock to create systems – in trade, healthcare and more – from scratch, which would normally require months or years of planning.
It is important that we encapsulate this drive and determination when focusing on our economic recovery, and it’s clear that trade will be a key part of this.
Covid-19 highlighted the fact that the UK is too dependent on a small number of countries for our imports. Equally, UK exporters are highly dependent on the EU. As Brexit made clear, people across the country want us to branch out and not be so wholly dependent on Europe for our economic futures. We shouldn’t be limiting ourselves – instead, we should diversify our trade to make the UK economy more resilient.
A free trade agreement with the US and acceding to CPTPP would not only diversify our imports and exports, but it would also see lower costs of trade. An ongoing theme of the 2019 general election was reviving our “forgotten towns”, and a trade deal with the US would benefit every region and nation of the UK, with the Midlands, the north-east, and Scotland gaining the most.
If we are to truly “level up” our towns, we need to take bold action and lead the way in setting transparent, high standards for international trade. We can build a platform for businesses to grow and expand after Covid-19.
We have already opened the US market to British beef, which is worth £66 million to British farmers. This is a fantastic first step, but we could gain so much more by securing a broader deal with the US. Expanding trade further for farmers would allow them to be more adaptable when dealing with demand shocks and seasonal availability.
British farmers depend on trade and we should be backing them by providing them with more opportunities to export their produce and increasing competition when importing feed and fertiliser, helping to keep their costs down.
Analysis by the Department for International Trade shows that a US deal could lead to a £15 billion increase in trade, deliver lower tariffs across produce, including beef and cheese, and create export opportunities, cheaper input costs and higher prices for British produce. It’s an opportunity we should grasp. Particularly when we already import 30 per cent of our beef – and almost entirely from the EU, despite US prices being comparable to prices in the UK and EU. Any US beef imports would likely substitute for other imports rather than impacting domestic sales for UK farmers.
Of course, it’s vital that all animal products imported into the UK meet our stringent food safety standards, no matter where they are imported from. We will also uphold our manifesto commitment and ensure that we will not compromise on our high environmental protections in any of our trade negotiations. UK consumers know what they want and we can expand the choices available while still holding producers to high standards.
We can negotiate a trade deal with the United States in parallel with the EU – and this will help us secure the best possible terms, as we will have the confidence to walk away from the negotiating table if the right deal is not on offer.
The UK Government has been clear that, when negotiating with both the US and Europe, we will only sign up to plans that will benefit our economy and businesses, not just any old deal. The NHS, for example, is not for sale, and there will be no compromise on environmental, animal welfare or food standards – that much is absolute. But there is scope for a mutually beneficial agreement that can boost jobs and businesses in the UK while delivering more choice to consumers.
