Today, we are publishing a suite of documents that mark a crucial step in beginning the formal negotiations for a free-trade agreement with our largest bilateral trading partner, the United States. These documents comprise the Government’s negotiating objectives, our response to the public consultation and an economic scoping assessment. They are available online and in the House of Commons Library.
The UK stands at an historic moment, building its independent trade policy for the first time in almost half a century. This Government will seize the opportunity to be an independent free trading nation with a simple message: that free trade is good for all nations and will deliver benefits for businesses, households and consumers across the UK. We aim to have 80% of UK trade covered by free trade agreements within three years, starting with the EU, the US, Japan, Australia and New Zealand. Seeking these agreements is key to our efforts to level up, deliver opportunity and unleash the potential of every part of the United Kingdom.
The US is one of our largest friends, the world’s largest economy, our closest security and defence partner and one of our oldest allies. We are the biggest investors in each other’s economies. An FTA represents a fantastic opportunity to strengthen and deepen our strong trade, investment and economic relationship, bringing us closer to the world’s economic powerhouse. In 2017, 1.7 million people worked for US companies in the UK, and 1.3 million people worked for UK companies in the US. UK-US total trade was valued at £221 billion last year, representing 19.8 % of all our exports. An ambitious free-trade agreement with the US could deliver a £15.3 billion increase in bilateral trade and a £3.4 billion lift to the economy.
The negotiating objectives we are publishing today are underpinned by one of the largest consultations ever undertaken. We received the views of more than 150,000 respondents, all of which have informed our approach and negotiating objectives. We have scaled up our trade negotiator expertise, with a similar size of team to the US Trade Representative, including a wealth of experience from the private sector, trade law, Commonwealth nations and World Trade Organisation experts ready to deliver for the UK.
My Department’s analysis shows that every single part of the UK could benefit from the US deal, delivering improved access for businesses, more investment, better jobs and higher wages. For Scotland, it could lock in the salmon and whisky trade and support new market access for beef and lamb. Wales stands to gain access for its lamb, and reduced tariffs in red tape for steel and ceramics. Northern Ireland can benefit from improved access to agriculture and furniture tariffs. Every region in England stands to benefit, particularly the midlands and the north-east with their strong manufacturing base in cars and machinery. We also expect significant gains in the tech sector across the country, with a bespoke digital and data agreement.
North, east, south and west, from agriculture to the creative industries, we find that a US trade deal can deliver for all parts of the UK economy. It means more choice for consumers at lower prices, new opportunities for businesses and more high-skilled jobs. It has the potential to slash trade barriers and tariffs of some £451 million, and it could boost British workers’ wages by £1.8 billion.
Small and medium-sized businesses are increasingly international traders in their own right. In 2018, 97% of goods exporters were SMEs, and 30,000 SMEs across the UK already trade with the US. We are going to make it a priority in these trade negotiations to support UK SMEs. We will do that with a dedicated chapter for SMEs. We will ensure that SMEs have easy access to information, and we will make sure that there are SME-friendly provisions, cutting red tape on customs and tariffs in services and goods.
We are also looking to rewrite the game on digital trade, to create a world-leading ecosystem that supports businesses of all sizes across the UK. This could include provisions that facilitate the free flow of data and prevent unjustified data localisation requirements, while maintaining our ability to protect users against online harm. We can ensure that customs duties are not imposed on electronic transmissions, and create great opportunities in areas such as blockchain, driverless cars and quantum technology.
In these trade talks, as in all future trade talks, this Government will drive a hard bargain on behalf of the British people. The NHS, the price it pays for drugs and its services are not for sale. There will be no compromise on high environmental protection, animal welfare and food standards. Throughout these negotiations, this Government will continue to engage collaboratively with Parliament, the devolved Administrations and the public. I can also assure the House that now that the UK is free to negotiate outside the EU, we will be aiming to begin negotiations with the US as quickly as possible. The appetite is clear on both sides. We welcomed the US Government’s negotiating objectives, particularly on developing “state-of-the-art” provisions in financial services and digital trade. We also welcome the enthusiasm, both in the US Congress and in the US Administration, as was made clear during my discussions with the US Trade Representative, Robert Lighthizer, last week. We see this as not just an opportunity to deepen our bilateral trade and investment relationship; it is also about setting an example to the world, about how two leading, open, free-market democracies can trade with each other.
As an independent trading nation, the UK will champion free trade and lower trade barriers at every opportunity. Striking free trade agreements will give our businesses the opportunities, certainty and security they need to prosper. The greatest opportunity to do that is with our closest ally and largest single trading partner, the United States. We have a mandate and we have the team. With these documents we are publishing today, we have the tools. And with hard work, I believe we can get it done. I commend this statement to the House.
May I thank the Secretary of State for early sight of her statement? We on this side of the House support ambitious trade agreements that unlock economic growth, create new jobs, and elevate rights and standards, so I congratulate her and her officials on the publication of today’s negotiating mandate for the Government’s flagship post-Brexit trade agreement. A year after the US equivalent, it has been greatly anticipated.
Some 20% of our current trade is with the US. It is our second biggest market, and we have enjoyed decades of two-way trade without an underlying trade agreement. The Government predict GDP growth of 0.07% to 0.16%, or £1.6 billion to £3.4 billion, as a result of this agreement. To put that in context, the Government’s own figures suggest a fall in GDP of about £150 billion as a result of the type of trade deal being proposed with the EU. Would it not be sensible to prioritise minimising losses of £150 billion, rather than chasing much smaller gains of £2 billion to £3 billion? How much will be added to GDP by the trade agreements with Japan, Australia and New Zealand, to which the Secretary of State referred? Will she confirm that countries on the other side of the Atlantic or further afield simply cannot come close to replacing what will be lost in the type of trade deal being proposed with the EU?
The negotiating objectives contain references to a level playing field with the US and a commitment to prevent either side from enjoying an artificial advantage—a commitment not being offered to the EU. Does the Secretary of State believe that the EU has not noticed? Or does she think the EU does not have access to translators? Dispute mechanisms are used by the US in international trade agreements to enforce its standards as a matter of course. It is noticeable that the EU negotiating objectives specifically exclude environmental protections and workers’ rights from the proposed dispute mechanism, but no such exclusions have been set out in the objectives published today, so will the UK end up having to back down, or are the rights and protections really the red lines that the Secretary of State would have us believe? Will she insist that the US signs up to International Labour Organisation conventions? How will the agreement reinforce the UK’s commitment to net zero by 2050?
The Chancellor’s adviser said yesterday that we do not need a farming industry or a fishing industry; who should we believe—the Chancellor’s adviser or the Secretary of State? The Government say that they will not allow chlorine or acid-washed chicken—processes used only because of insanitary conditions in the United States—but they also say that such produce is safe; which of those is the Government’s position? Will they make the necessary commitments in law to protect our consumers by adding them to the Agriculture Bill?
The US trade representative says that the US will demand greater market access for US pharmaceutical businesses, which could drive up the cost of medicines. Meanwhile, the provisions of trade agreements can apply inadvertently to public services and lock in privatisation measures, against public concerns and the public interest. Will the Secretary of State confirm that she will ensure that explicit wording rules out liberalisation measures from applying to our NHS and to all public services?
The mandate published today appears mainly to be about tariffs; mucking about with tariffs does not constitute an international trade agreement. The current round of trade tariffs has damaged leading British exports, including Scotch whisky, and caused great concerns in our ceramics and steel sectors. The Government have already spelled out their plans to drop tariffs to zero; where is the incentive for the United States to do the same? What is to stop them walking away from a deal because we have given them everything that they want without the need for an agreement?
The Secretary of State mentioned Congress, so on the subject of scrutiny she must recognise that her statement does not constitute adequate parliamentary engagement on this process. Will she tell NHS patients, farmers, manufacturers, consumers and workers just how she intends to enable scrutiny of this and all other international trade agreements?
I am pleased that the Opposition have acknowledged that there is value in trade deals and, indeed, in a trade deal with the US, because previously many of them have voted against trade deals with Canada and Japan. It is hard to understand who they actually want to do any business with.
The hon. Gentleman asked specifically about the trade arrangements with the EU; the simple answer is that we want a good trade deal with the EU and a good trade deal with the US. That is absolutely possible. Canada has an excellent trade deal with the EU and we want similar terms to it, and it also has a very good trade deal with the US, with an advanced digital chapter. It should be perfectly possible for us to seek such an arrangement that enables us to unlock the economic benefits of a deal with the US.
It takes a party with the economic literacy of the current Labour party to think that £15.3 billion of additional trade is not worth having. Why does the hon. Gentleman not tell that to the people of Stoke-on-Trent and the ceramics factories that could benefit? Why does he not say that to the midlands car manufacturers who want easier testing procedures? Why does he not say that to the people of Scotland, which is one of the regions that would benefit most from a free trade deal with the United States? The hon. Gentleman asked me about the other deals that we are seeking—[Interruption.] Does he want to hear the answer to the next bit? He asked me about the other deals that we are working on at the moment. I will, in due course, be laying out our proposals for a deal with Japan, Australia and New Zealand. I can assure him that we will be publishing the full economic scoping studies, as we have for the United States, and we will be publishing objectives for those arrangements as well, in line with the commitments that we have made to Parliament. I am fully committed to working with Parliament on these arrangements. Of course, a treaty is an Executive prerogative, but, at the same time I will be working with the International Trade Committee and making sure that we have proper scrutiny. We have been working with the devolved Administrations. My right hon. Friend the Minister for trade policy has had regular meetings with his colleagues in Northern Ireland, Scotland and Wales.
The hon. Gentleman does not seem to have heard what I said about food standards and animal welfare. We will not be diminishing or lowering our standards as part of a US trade deal, and we will not be paying more for drugs prices in the NHS. That is clearly laid out in our objectives for everyone to read. Were the US to demand that—I do not believe that that will be the case—we will simply walk away. As he pointed out, we are already trading well with the US. If we do not get what we want from this agreement, we will walk away.
Finally, I want to make a point about British agriculture. As a former Secretary of State for Environment, Food and Rural Affairs, I am a great believer in the fantastic products that we produce in this country. I believe that they should be available in more countries around the world. I want UK beef and lamb to be on US shelves. I want the tariffs on dairy products, which can be as high as 18%—[Interruption.] Indeed, on cheese products as well. I want those tariffs to be lowered so that we can get more of our fantastic products into the US market. I suggest that the hon. Gentleman reads today’s scoping assessment, which shows that UK agriculture will benefit economically from a trade deal with the US.
I congratulate my right hon. Friend on her statement. Will she confirm not only that UK exports to the United States currently attract half a billion pounds-worth of tariffs, the removal of which will be an immediate boost to the UK economy, but that the opportunities are even greater? We are currently involved in retaliatory tariffs as a result of the EU-US steel dispute and we are subject to tariffs that the US never wanted to apply to the UK. As we separate ourselves from the European Union, we can remove ourselves from the ensnarement of that, which will enable us to remove many other tariffs, which would be beneficial to both consumers and businesses on both sides of the Atlantic.
My right hon. Friend is absolutely right. May I thank him for the work that he put in as Trade Secretary, which has got us to this point where we are able to launch these negotiating objectives, and for doing all the fantastic work that he did with our colleagues in the United States? I know the Labour party does not seem to think that tariffs are important, but that is not so for a pottery manufacturer in Stoke-on-Trent who is facing 28% tariffs on their dinnerware going into the US. If we get those tariffs removed, that will mean that that factory is able to employ more people, grow its business and invest. Yet again, that is the Labour party refusing to understand how enterprise works and where wealth comes from in this country.
My right hon. Friend is right about the steel industry. It is currently facing £300 million-worth of tariffs a year. If we can get those tariffs removed, that provides a brilliant opportunity for our steel industry to sell more products in the United States.
I thank the Minister for her statement and early sight of it. It is true that the analysis published today, which forms part of these documents, does provide some very useful information. It tells us that the maximum tariff reduction will be less than half a billion pounds, that the maximum increase in UK GDP would be 0.16%, that the maximum increase in gross value added for Scotland would be less than half a per cent—0.4%—and that, in the long-run, financial services GVA might actually go down. Yet in order to achieve these decidedly underwhelming targets, the UK will have to leave the European Union, surrender around 5% of GDP growth, and risk around 20% of UK global trade.
More worryingly, a pattern is emerging in the UK’s approach to trade negotiations. In the document on the future relationship with the EU, the UK seeks to exclude subsidies, competition policy, and environmental, tax and labour provisions from any dispute resolution mechanism. In today’s UK-US public negotiating objectives —only four pages of the total published today—there is limited reference to competition, labour and environment provision, nothing on subsidy or tax, and a single vague bullet point on dispute resolution that would enforce the level playing field and avoid the race to the bottom.
Apart from the environment, the Secretary of State mentioned none of those things in her statement. Let me ask her this: why are the UK Government giving the impression of abandoning level playing field provisions across so many aspects of modern trade deals? Why are they giving the impression that they are in favour of a wild west free-for-all in trade rather than a comprehensive rules-based system with a comprehensive dispute resolution mechanism? Why are they prepared to sacrifice so much in terms of global UK trade and GDP growth to secure what, by their own admission, are very, very modest gains indeed?
I have news for the hon. Gentleman: we have already left the European Union, although the news might not have reached him.
Scotland is one of the largest potential beneficiaries of a US-UK free trade agreement. The hon. Gentleman sniffs at the half a billion pound extra value added to the Scottish economy that is analysed, but a number of Scottish businesses are supportive, including the Scottish chamber of commerce. I suggest that he listens, as we have been doing, to businesses in Scotland about how they can see their businesses grow.
The hon. Gentleman specifically mentioned standards. In free trade agreements, including in the comprehensive and economic trade agreement, or CETA, there are often clauses saying that the parties will not deliberately lower standards for competitive advantage. That is what we are referring to in our US negotiating objectives and it is a perfectly proper and regular part of free trade agreements that we are happy to sign up to.
Order. I intend to run this statement until about quarter past 6. I urge short questions and short replies. Anybody who was not here at the beginning should not be standing. I will prioritise people who did not get called during the previous urgent questions.
I thank my right hon. Friend for her question. As we make very clear in the negotiating objectives, we will not lower our standards. We will maintain our food safety and animal welfare standards and will not lower them as part of this free trade agreement. We decide which standards we abide by here in the UK. We have exceptionally high standards of animal welfare, and my right hon. Friend herself is a champion of that. We are not going to be told by the US what our standards should be; for that matter, we are not going to be told what our standards should be by the EU either.
Along with a majority of Labour MPs, I voted for the Canadian trade deal. The debate on that treaty was beset by disinformation campaigns by many non-governmental organisations, as was the Transatlantic Trade and Investment Partnership deal. Frankly, the Government did precious little to rebut them.
Currently, one of the concerns is whether drug prices will rise in the UK; the Secretary of State touched on that. Is there not a great desire across the United States, in fact, to achieve the same excellent deal as the NHS has secured? I doubt whether, in election year, even Donald Trump will die in a ditch for big pharma. Will the Secretary of State see this as a political campaign and not just a narrow, dry trade negotiation?
The right hon. Gentleman is a great champion of free trade on the Labour Benches, and I hope that his views prevail and become more mainstream in Labour party opinion. He makes a good point. Of course, there are strong economics behind this trade deal as we have outlined today. But there are those who seek to undermine the proposals and the benefits for British businesses with various smears and scare stories about the NHS, animal welfare standards or other issues. Those people damage the potential for British businesses and our economy. We are determined to rebut the false stories that they are putting out and to make sure that we put across the positive case for the whole UK.
I do not share the Scottish National party’s miserable analysis of the trade deal; I see great opportunities for Scotland from a deal. But there is a cloud on the horizon: the 25% duty currently applied to malt whisky. What confidence can the Secretary of State give us that at the end of this process there will be no duties on Scotch whisky of any kind in the United States and no duty on bourbon in the United Kingdom?
My right hon. Friend is right that this is a major issue for our excellent Scotch whisky producers and other companies such as Walkers shortbread and cashmere producers. I raised the issue again with Ambassador Lighthizer when I saw him last week. I want there to be an urgent settlement of the Airbus-Boeing dispute so that retaliatory tariffs on things such as bourbon, Harley-Davidsons and Florida orange juice as well as on our excellent products here in the UK can be removed. I am urging, as an early part of these trade negotiations, the removal of existing tariffs to show good will towards the negotiations.
Any increase in trade is clearly to be welcomed, but in private the Secretary of State will be honest, I am sure, about recognising that the benefits of the deal to the UK economy will be relatively small: just a 0.16% increase in GDP, and then only after 15 years. Why does she not do two other things? She could try to persuade her Cabinet colleagues to seek a deal with the European Union more ambitious than the Canada-light deal currently being advocated and, for goodness’ sake, to get behind a third runway at Heathrow.
I welcome the hon. Gentleman’s agreement with me that removing barriers to trade is good for everybody—it is good internationally and good here in the UK. One thing he fails to point out, though, is that there are huge benefits in regulatory freedom and flexibility. As the UK is able to decide its own rules and regulations, we can be more nimble and agile in the modern world—a key benefit of our leaving the European Union and having a Canada-style deal with the EU.
I agree with my right hon. Friend’s comment that the US is very excited about this trade deal—not just Washington politics, but across the whole United States.
I want to press the food standards point. The US is the biggest exporter of agricultural products in the world. Does my right hon. Friend agree that it achieves that through selling products that the world wants and not through forcing unwanted products on unwilling consumers?
My hon. Friend is absolutely right that good export champions are companies that suit the markets that they serve. We will maintain our standards about what we believe to be right for UK consumers in line with the values of the farmers and people of the UK. It will be up to those that supply us—the US, the EU or anybody else—to fit with those standards. That is the nature of trade agreements.
In 2018, at the World Health Assembly, the US tried to modify a resolution on breastfeeding, allegedly threatening Ecuador, which was sponsoring the measure, with punitive trade and aid measures. What assurance can the Secretary of State give the House that the UK will protect, promote and support breastfeeding ahead of the commercial interests of global formula companies—particularly those in the US, which produce formula to lower standards of composition and nutrition than we have here in the UK and in the EU?
The hon. Member is right to highlight this issue. However, a free trade agreement is specifically about the rules around trade. There are other organisations that set global standards in other issues. The World Health Organisation will, of course, be taking a lead on the environment in terms of COP26. There is always a bit of a danger in trying to pile too many issues into free trade agreements. This free trade agreement is all about ensuring that British consumers and businesses benefit from increased trade with the UK.
I very much welcome this statement, particularly the opportunity for all four corners of the UK to benefit. May I ask my right hon. Friend to outline how a free trade deal with the United States will benefit mid Wales, and my constituents in Brecon and Radnorshire in particular?
I am still to take up my hon. Friend’s invitation to visit one of the sheep markets in her constituency, but I am looking forward to it because I believe that Welsh lamb is a prime product, and we want to get it into the US market. We also want to remove tariffs on Welsh dairy products going into the US. Our projection shows that agriculture overall—and specifically in Wales—will benefit from a US trade deal.
The section 232 tariffs imposed by President Trump have had a deeply damaging impact on our steel industry, leading to a 30% drop in UK steel exports to the US. Does the Secretary of State agree that all trade talks with the US should be suspended until such time as our steel industry has been exempted from these completely unacceptable and protectionist tariffs?
I want to get the trade talks started so that I can get those tariffs removed.
In welcoming this statement, I note that the very substantial and comprehensive Transatlantic Trade and Investment Partnership negotiations seemed to be distorted, by the media and many lobbying interests, into little more than one or two contentious policy areas. Are we going to learn the TTIP lessons, and in particular ensure that when deal information is released for review by the US Congress, Parliament consents to that at the same time—to minimise room for unhelpful or one-sided comment or speculation?
I agree that we need to make a clear case, and to ensure that Parliament is engaged.
I am interested to hear the Minister say that she wants to ensure that Parliament is engaged because, unlike our counterparts in the US Congress and the EU Parliament, Members of this House do not get a vote on trade deals. Is she prepared to consider reversing that policy? If not, can she tell us in what way having no debate on the trade deal constitutes taking back control?
The hon. and learned Member will be aware that the UK has a parliamentary system that is similar to those in Australia and New Zealand, and we are following a similar process to those Parliaments. It is a different structure from the separation of powers in the United States.
It is worth noting that the UK would have concluded a better trade deal with the US if it had been a member of the EU—part of that stronger negotiating power. Can I ask the Secretary of State how this is going to work with regards to Northern Ireland? As a by-product of the protocol, Northern Ireland will be carved out of certain aspects of UK trade deals, while at the same time EU trade deals will not be rolled over for Northern Ireland. How are we going to benefit? Are we actually in danger of being marginalised in both respects?
The Agriculture Bill and the Environment Bill are going through Parliament at the moment, and require our food producers to meet the very highest environmental and food standards. I welcome the Secretary of State’s commitment that no compromise will be made regarding environmental protections, and animal welfare and food standards, but what reassurance can she give to food producers in my constituency who do not believe that they will be faced with a level playing field once the trade deal is done?
I can assure my hon. Friend that it is written very clearly in our document that we will not be compromising on our food standards. I highlight to him the opportunities for agriculture in the west country of lowering barriers into the US and being able to export more of its fantastic products.
There is a lot of disquiet being expressed about digital services and tech companies, and their use of personal data. I note from the larger document that was published today that a lot of the public consultation also expressed concerns about personal data being used by US firms. What guarantees can the Secretary of State give to the House that the personal data of UK consumers will not be subject to any fewer protections than they currently enjoy under the general data protection regulation?
We are committed to protecting personal data. There are huge opportunities in striking an advanced digital and data chapter on the flows of data between the UK and the US—ensuring that those flows are properly underwritten and giving software companies opportunities. There are huge advantages, but we will always ensure that we are protecting people online and personal data.
Free trade is the greatest driver of global prosperity that the world has ever seen. Would the Secretary of State agree that in addition to the prospect of lowering prices for UK consumers, the high-tech businesses of west Oxfordshire can look forward to this massive global market being open to them—a market that also happens to be one of our closest friends?
My hon. Friend is right. Some 79% of all the services we provide are supplied remotely—many of them into the United States. Having this underwriting on digital and data will really help companies in areas such as robotics, artificial intelligence and computer gaming, and will provide a massive strategic advantage for the UK against our competitors.
As we have heard, according to the Government’s figures, the very best deal that they can do with the US will result in GDP growth of 0.16%—leaving aside the concerns over reduced standards, especially in food. With the Secretary of State’s Government once again raising the spectre of no deal with the EU, which Government figures show would see growth of around minus 8%, put simply, wouldn’t no deal with the EU and this deal with the US be at best like losing £8 and finding a 20p piece?
It is very interesting that half a billion pounds in extra economic value does not mean anything to the hon. Member.
I welcome my right hon. Friend’s statement and the prospects for more engagement with the dynamic US economy. The Conservatives are the party of free trade. Whenever protectionism has been touted, such as in the elections of 1906 and 1923, it has not ended well for us. Does my right hon. Friend agree that there is big scope for more marketing support for our high-quality produce, such as Somerset cheddar and brie, and that fear of imports does not take account of the ability to deal in zero-tariff quota opening, rather than complete tariff reduction up to any amount?
My hon. Friend has outlined a number of options; I will be interested to hear more as we go through the negotiations. He is right that we have great products that are currently facing tariffs of up to 18%, and that we could eliminate those and see more exports into the US market. We will be looking at our export strategy—the exports Minister, my hon. Friend Graham Stuart, is with me on the Front Bench—and ensuring that we turbocharge our exports as we go into this important year of being an independent trading nation.
I refer the House to my entry in the Register of Members’ Financial Interests. The Secretary of State talks about removing barriers to trade and mentions the creative industries, which I welcome. Musicians and others currently tour the EU without any barriers whatever, or a need for visas or forms for their equipment and instruments; their experience with the US is completely the opposite. What reassurance can she give us that she will prioritise visa-free travel in the US for creatives, with form-free transportation of musical instruments and equipment?
The hon. Member will notice that we are very clear in our negotiating objectives about the protection of intellectual property for the creative industries, and about the opportunities for better visas and travel. We will be working on that throughout the process.
US public procurement potentially offers exciting opportunities for British companies to access an enormous market. However, as my right hon. Friend will know, much public procurement in the United States is conducted at state and municipality level. How does she propose to reflect that state of affairs in any future free trade agreement?
My right hon. Friend is right. There are issues that are dealt with at a federal level and a state level. We will be seeking an agreement that secures access to US Government procurement at a federal level. We will also be looking, in the first instance, at the major states as well to gain more access for British companies.
The Secretary of State said that if an agreement could not be reached to exclude the NHS from any trade deal, then we would walk away, but will she be clear on whether, if any trade deal was done, she would expect there to be explicit wording in it to exempt public services from any liberalisation measures?
I can assure the hon. Lady that we will put in the wording necessary to deliver the commitments that I have laid out in the objectives—that is, no increases to drugs prices, no services put at risk, and also the NHS itself not being on the table. That will be clear.
The fact of the matter is that our exports to the US are growing at a faster rate than they are to the EU. The west midlands has consistently had a trade surplus with the USA. Does the Secretary of State agree that a US trade deal would open up new markets for small and medium-sized businesses and herald many new opportunities for business and industry in the west midlands?
There are huge opportunities in the midlands for further trade with the US. The midlands is already a very strong exporter to the US. I believe that one in five goods from there goes to the US market, but we can do more to remove tariffs and also to get rid of some of the testing procedures and non-tariff barriers that are stopping our car industry exporters so much.
I was pleased to hear the Secretary of State state her commitment to protecting UK citizens from online harms. She will know that the US-Mexico-Canada trade agreement required the insertion of the section 230 provisions of the United States’ Communications Decency Act, which give immunity from liability to the big social media companies. If an approach like that were incorporated in a UK-US deal, would be impossible for us to bring forward the online harms regime and take action against social media companies for failing to act against harmful content. Will she confirm that the British Government would not accept a move in this country equivalent to section 230 in the US-Mexico-Canada agreement?
I can confirm that we stand by our online harms commitment, and nothing in the US trade deal will affect that.
I particularly thank the Secretary of State for mentioning the ceramics industry in Stoke-on-Trent. Does she agree that this has huge potential to give access to markets in the US for a number of ceramics firms, but also for a number of other industries right across Stoke-on-Trent, and to help to level up the opportunities for the people I represent in Stoke-on-Trent South?
I thank my hon. Friend. I enjoyed visiting his constituency and meeting some of the fantastic companies there, including Walker’s Nonsuch Toffee, for which I also want to secure a tariff reduction.
We want to achieve a world-leading data and digital agreement, underwriting data flows but also dealing with issues like blockchain and artificial intelligence, thereby making sure that we and the US are leading the world and able to share these economic opportunities.
I very much welcome this statement, but I know that the Secretary of State is aware of the very negative impact that US tariffs are having, particularly in my constituency, on textiles and cashmere. I am pleased to hear what she is doing to address that, but can she reassure me that there will be some sort of restriction in the trade deal on the US imposing these arbitrary tariffs in future on whisky and other sectors within the Scottish economy?
As has been pointed out, Scotch whisky has been hit by retaliatory tariffs between the US and the EU. Of course we want to see that settled. We also want to see resolution on the Airbus-Boeing dispute. In future, I would be seeking to avoid such tit-for-tat tariffs, making sure that we have agreement on both sides.
The truth is that these negotiations and those with the EU are vital for business, growth and jobs across the UK. Does my right hon. Friend believe that the timing of the US presidential elections may give a fair wind to the urgency of resolution of her negotiations?
We are pushing our full complement of resources into these negotiations, and so is the United States. I am not going to set a deadline on the negotiations but I certainly hope that the prevailing political wind will help us to conclude as early as we can.
I really welcome the visits by my right hon. Friend and by the Minister of State, my hon. Friend Conor Burns to Stoke-on-Trent. I think that my right hon. Friend is very well aware of the particular issues facing the ceramics industry. Within this ambitious trade deal, we certainly want punitive tariffs removed from the ceramics industry, and I hope that that will be part of any negotiations.
That certainly will be part of our trade negotiations. There are many industries across the UK that face high tariffs and high barriers. We want those removed so that we can see every part of the UK thrive.
May I heartily congratulate my right hon. Friend on bringing this statement forward on the same day that the talks begin with the EU? She followed me at the Department for Environment, Food and Rural Affairs, and she knows perfectly well the tremendous opportunities in the States for UK food, agricultural and drink products, particularly Scotch whisky. Does she agree also, going the other way, that this gives a massive advantage to every family and every business in this country, who will now have access to goods produced to world standards at world prices, forcing European producers hitherto protected by the tariff wall to sell here at world prices?
My right hon. Friend makes a typically Ricardian case for lower tariffs and lower barriers. He is right. It will help our British citizens to lower their cost of living, which is good for us all.
Ever since King George III accepted John Adams’s credentials as ambassador to the United States, both states respectively have regarded each other as sovereign equals and worked ceaselessly towards fostering ever closer diplomatic, military, cultural and commercial ties. Does the Secretary of State agree that a future free trade agreement should be seen as part of this story? I am a proud Yorkshireman, and like many of those who come from God’s own country, we love the USA. Any agreement that makes it easier for my American friends to more easily and affordably buy Harrogate’s world-famous Yorkshire Tea is to be welcomed.
I do agree. I know the Americans have an affinity both for Yorkshire tea and Yorkshire beer.
Does the Secretary of State agree that the removal of the tariff of 19.8 cents on every litre of English sparkling wine represents a great opportunity?
My friend is absolutely right. We have seen the growth of sparkling wine exports, which now, I think, total more than £100 million a year. I see huge opportunities in removing those tariffs and getting more of our excellent sparkling wine into the United States.
North-east Lincolnshire is a major centre for the renewable energy sector, and a number of US delegations have already visited to look at opportunities. Would the Secretary of State give an assurance that her Department will support the small and medium-sized companies that want to get into the supply chain in this sector?
One of our key asks from the US trade deal is a dedicated chapter to make it easier for small and medium-sized enterprises by removing some of the customs red tape, being able to do more things online, and being able to get better information. I will certainly look at my hon. Friend’s specific businesses in Cleethorpes in that regard.