Sunak and Biden negotiating UK-US trade deal amid doubts from Badenoch

Wed 4 Oct 2023
Posted by: Phil Adnett
Trade News

UK and US flags

UK prime minister Rishi Sunak and US president Joe Biden are preparing to open negotiations on a long sought after UK-US trade deal.

Politico reports that the expectation from both sides is that the deal will be completed before both Biden and Sunak face re-election.

The US presidential election is scheduled for 5 November 2024, while a UK general election is expected at some point next year. The last date for calling a general election would be in January 2025.

The initiative has been tentatively called the US-UK Trade Partnership Forum (TPF), and is set to include a number of “thorny” issues such as agriculture, as well as topics like workers’ rights, trade in services and digital trade documents.

The outline of the deal set out in the papers seen by Politico does not contain the market access commitments normally required for a formal free trade agreement in the eyes of the WTO.

The Guardian reports that a UK-India trade deal remains the priority. However, as a consequence of the US and India negotiations, other agreements will be worked on less, such as the UK-Mexico and UK-Canada deals.

Agriculture

One potential stumbling block is agriculture, as the US has already said it wants concessions.

According to Politico, the UK Department for Environment Food and Rural Affairs (DEFRA) is “blocking this” move.

One source said that it would be down to Rishi Sunak to back DEFRA or agree to concessions.

Long history

A UK-US trade deal has long been sought by successive PMs, with Boris Johnson initially prioritising this after the UK formally left the EU in 2020.

Tensions between Washington and London over the contentious Northern Ireland Protocol hindered any progress on a deal, although the Windsor Framework, agreed between the EU and UK, appears to have eased these concerns.

In the meantime, the UK has pursued a strategy of state-level agreements to build momentum towards a wider federal deal. So far, six states have signed agreements with the UK, and Florida has been tipped as the next state to ink a deal.

Badenoch’s doubts

However, there was doubt from within the Conservatives on whether a deal with the US would be possible under Biden’s administration.

Business and trade secretary Kemi Badenoch told a fringe event at the Conservative Party Conference that there was virtually no chance of a UK-US deal under Biden.

“Under this administration – zero,” Badenoch said in response to a question about the possibility of a trade deal.

She added that Biden’s White House has “very close links with unions”, who she said were opposed to free trade agreements.

According to the Independent, she refused to comment on whether she thought that it was more likely that a deal would be achieved under former-president Donald Trump, the current frontrunner for the opposition Republican party.