Donald Trump’s arrival in the White House is bringing huge changes to America and its relationship with the rest of the world. For many, his disruption to the norms we have lived with for so long will be challenging. Yet such upheaval can and will bring opportunities too, and – as Lord Mandelson prepares to take over as the UK’s ambassador in the United States – it is vital that Britain now steps up and takes bold and imaginative initiatives to strengthen our relationship with the US in order to secure greater prosperity and security for the citizens of both countries.
Business between the UK and the US is strong. Annual trade in goods and services is worth more than £300 billion and America continues to be Britain’s largest single national trading partner. UK exports to the US have risen over the last decade, powered by a big increase in business services. There is, however, significant potential to enhance and grow this essential economic partnership further by removing barriers to trade and facilitating market access. As the US has traditionally run a trade surplus with the UK, there is a strong case, too, for Britain to be exempt from any potential tariffs Trump may threaten to impose on various countries and the EU.
It was Trump who, in his first term in office, kick-started trade negotiations with the UK with the prospect of striking a comprehensive free-trade agreement (FTA). Talks went well on a number of issues but were stalled in 2020 and put on ice by the Biden administration relating to continuing uncertainty around Brexit and Northern Ireland. Those problems have now been resolved and there is renewed hope on both sides of the Atlantic that the negotiations can restart albeit with a recognition that are certain sectors in both countries – agriculture in the UK, cars in the US, for example - that will require special protection.
Even if a “full-fat” FTA is not attainable, there is significant potential for deals in particular key sectors and it is reassuring that the new government in London is maintaining the good work of its predecessor to promote trade between Britain and American states. The latest Memorandum of Understanding (MoU) was signed with Colorado last week, taking the total of such deals to nine with the prospect of more to follow.
The continued strong performance of the US economy should also be a huge incentive to UK business looking to grow – and presents a huge opportunity for the UK Government which is now promising bold measures to kickstart economic growth in Britain too. At Richardson, as an international investment business, we consider the US as a key market and have a wide range of interests and investments across sectors and from coast to coast. We have long admired the American ‘get up and go’ business culture and continue to learn and develop through our relationship with our American partners.
Earlier this year we began a new relationship with New York City-based Leeds Equity Partners to invest in education and training sectors across North America, and we continue to explore a range of new investment opportunities from coast to coast. For many years the UK was the largest investor in the US. Yet between 2018 and 2023, we were surpassed by Japan, Canada and Germany. Direct investment from those countries increased by more than 40% in that period compared to just 8% from Britain.
So there is plenty to do as Lord Mandelson arrives in Washington DC to take up his new position. His appointment was a bold, if controversial, appointment, not least because of his political background. But, as a smart and experienced political operator who has operated at the highest levels of the UK Government and spent four years as the European Union’s trade commissioner, he brings unique skills to a role which has rarely been more important for Britain’s national interests.
He has an in-tray of issues that promise to shape the relationship between the US and UK for a generation. Amongst those, winning new opportunities for British business, and helping to broker similar such opportunities for US firms in the UK, will surely be a leading priority. After all, creating jobs, wealth and prosperity in this way will not only strengthen ties between the two countries, but also help to boost tax revenue to pay for crucial public services on both sides of the Atlantic.
Many in the UK business community will wish Lord Mandelson well, and we look forward to working with him. By putting Britain in the public eye in the US he can play a key role in both driving economic growth and new opportunities for our businesses. Equally, at a time of global geopolitical uncertainty, he can also strengthen diplomatic connections. Both of these will bring significant benefits to Americans and Britons alike.
