 |
British
economy 'to grow 0.16% at best under US trade deal'
Admission
lays bare limited benefits of ‘ambitious’ agreement with Donald Trump
Today’s
political news - live updates
Heather
Stewart, Lisa O'Carroll and Richard Partington
Mon 2 Mar
2020 12.45 GMTFirst published on Mon 2 Mar 2020 11.54 GMT
There are
fears that Boris Johnson (right) would try to water down standards in areas including
food production in trade talks with Donald Trump. Photograph: Peter
Nicholls/Reuters
The British
economy would be at most 0.16% larger by the middle of the next decade under a
comprehensive trade deal with the US, the government has admitted, laying bare
the limited benefits from striking an agreement with Donald Trump.
In a
document published by Liz Truss’s Department for International Trade designed
to kick-start post-Brexit trade talks with the Trump White House, the
government said the British economy stood to benefit from an “ambitious and
comprehensive” trade deal worth a fraction of GDP, equivalent to £3.4bn after
15 years.
Prompting
warnings from economists that the benefits would be far outstripped by the
losses from crashing out of the EU, the official analysis also showed that a
more limited trade deal with the US would deliver benefits to the UK economy
worth just 0.07% by the middle of the 2030s, or about £1.4bn.
The
government had previously estimated the economy would be as much as 7.6%
smaller should Britain leave the EU without a deal, and about 4.9% smaller
under Boris Johnson’s preferred Canada-style agreement.
Dr Peter
Holmes, an academic at the UK Trade Policy Observatory at Sussex University,
said: “The numbers are very small. It just goes to show how tiny the gains are
from an free trade agreement with the US compared to losing our present
arrangements with the EU.”
Outlining
the start of deeper talks with Washington, the UK government insisted it would
not water down welfare standards or put the NHS up for sale to secure a trade
deal with Trump.
In a
document, published by Truss’s department, the government said it was aiming to
reduce tariffs and other barriers to trade, but without compromising standards.
Overall,
the government said it was seeking to achieve “broad liberalisation of tariffs”
and “simple and modern rules of origin”, to determine which goods can pass
freely between the two markets.
Fears have
been expressed that the UK is preparing to water down standards in areas
including food production – allowing imports of chlorinated chicken, for
example. These were intensified when Boris Johnson said in his Greenwich speech
last month that such rules should be “governed by science, not mumbo-jumbo”.
But the
document reiterates the Conservatives’ manifesto commitment not to allow
welfare standards to be compromised.
“The
government’s manifesto has made it clear that in all of our trade negotiations,
we will not compromise on our high environmental protection, animal welfare and
food standards,” the document says.
It also
insists that NHS drugs prices will not be up for negotiation, saying
explicitly: “The price the NHS pays for drugs will not be on the table. The
services the NHS provides will not be on the table.”
Jeremy
Corbyn, the Labour leader, laid heavy stress during the general election
campaign on the risk that drugs prices could increase significantly, after a
Dispatches documentary revealed a series of meetings had been held between UK
and US officials in which the issue had been raised.
The US
negotiating mandate, published last year, pointed to public services as one
area for potential liberalisation.
Trade
expert Sam Lowe said the document showed the government intended to take a
robust approach to US demands that the UK drop barriers to trade in agriculture
and food, including chlorinated chicken and hormone-fed beef and to its desire
to get access to the NHS.
“If you
consider this as an opening document in a negotiation, then it shows the UK is
holding firm on the NHS and is quite strong on agriculture making promises not
just on food safety but on animal welfare. So the UK is saying it doesn’t want
to compromise. This means that we are in for proper negotiations not just a
quick deal, so we are in for the long haul,” said Lowe.
The
document is being published on the same day that negotiations with the EU27 in
Brussels over the future relationship kick off. Truss had argued the two
processes should run simultaneously, believing that would maximise the UK’s
leverage.
The
government stresses the potential advantages of a deal, including potentially
boosting exports of salmon, cheddar cheese and cars, claiming that “removing
trade barriers with the US could deliver huge gains”.
|
Opening
gambits
By Jim
Brunsden
March 2,
2020
David Frost
and Michel Barnier will today begin the epic task of forging a new EU-UK
relationship out of the ashes of Brexit.
Around 100
British officials will be making the trip to Brussels, as the two sides open
negotiations with competing visions of what that relationship should look like
— and very little time to reconcile them.
UK chief
negotiator Frost and Barnier, his EU counterpart, are used to doing business
together, having negotiated on Britain’s EU withdrawal treaty last year.
But in
terms of the breadth of issues to be addressed, the future relationship is of
an entirely different order of magnitude to the divorce.
No fewer
than 11 different groups of officials will work in parallel to dive into the
details of everything from trade in goods to civil nuclear cooperation and
access to fishing waters. The European Commission’s headquarters cannot provide
enough meeting rooms, so negotiators will be decamping to a conference centre
downtown.
The splits
between the two sides are well known, and are well defined in respective
negotiating positions published last week.
For the UK,
the goal is to secure the maximum market access that is compatible with its
overriding goal of pure, unfettered national sovereignty; for the EU, the aim
is a relationship that makes market access contingent on deep policy
commitments, and binding dispute-settlement.
This
ideological faultline leaves the talks on shaky foundations. The UK has
rejected the EU’s demand that Britain stick within the bloc’s state-aid regime,
saying such “dynamic alignment” undermines the very raison d’être of Brexit. It
has also pushed back against the EU’s call for a broader “level playing field”
of regulatory standards that would be backed by penalties if either side
breaches its obligations.
The EU
insists that it cannot do a trade deal without these assurances, because of the
risk that its companies would be placed at an unfair disadvantage.
There are
plenty of other reasons that talks might break down. The EU has insisted that
it will quickly stall the negotiations if the UK refuses to concede stable
access rights to its waters for Europe’s fishermen. A similar threat applies if
Boris Johnson backslides on commitments to impose checks on trade between
Britain and Northern Ireland.
Brussels and
Britain have often seemed to be talking past each other in recent weeks.
Barnier has
repeatedly warned that no trade deal can provide frictionless trade — and
Brussels knows that the British business community is anxious about the future
arrangements. But Johnson and Frost have emphasised that they are ready to
accept barriers as the price of securing the country’s policymaking
independence.
Both sides
are already looking to an EU-UK summit in June as a key moment to resolve any
impasse; Johnson has threatened to walk away from the negotiations if no
progress has been made by then.
By that
stage, only six months will remain until the end of Britain’s post-Brexit
transition period, with the prospect that the EU and the UK could be left
trading on basic WTO terms. The problem in this negotiation is not just lack of
shared vision, it is lack of time to argue.
jim.brunsden@ft.com;
@jimbrunsden
Sem comentários:
Enviar um comentário