Is UK trade with America ‘out of line’? Donald Trump’s comments explained
Is UK trade with America ‘out of line’? Donald Trump’s comments explained
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Donald Trump has warned the UK is “way out of line” when it comes to trading with the US as he has said he “might” hit Britain with tariffs. The US President has made clear the EU could be hit by similar measures to Mexico, Canada and China, as fears grow of an all-out global trade war. But where the UK slots into Trump’s tariff frenzy remains unclear, with experts unsure what exactly Trump’s comments mean.
Speaking to reporters overnight Trump remained open to a trade deal with Westminster but insisted the EU has taken advantage of the US. Asked by the BBC about the potential for tariffs on the UK, Trump quickly diverted his attention to the EU. “I can tell you that, because they've really taken advantage,” he began. “We have over $300billion deficit. "They don't take our cars, they don't take our farm products. They take almost nothing, and we take everything from the millions of cars, tremendous amounts of food and farm products.
“So the UK is way out of line... We'll see the UK, but the European Union is really out of line.”. He continued: “UK is out of line but I’m sure that one, I think that one can be worked out. “But the European Union, it’s an atrocity what they’ve done.”. Experts have pointed out that “it is not entirely clear” what Trump’s comments meant for the UK but there are a number of areas where the US has wanted closer ties with the UK.
Chris Southworth, the Secretary-General at the International Chamber of Commerce, told the BBC the UK and US have never been able to agree on a trade deal as it could mean opening the NHS to American corporations and lower food standards. He explained: “The dispute really, if there is one on trade between the UK and the US, is US companies want access to the NHS, US farm products don’t really meet the standard of UK consumers - the chlorinated chicken debate or hormone beef debate.
“In return, UK companies want access to US public procurement, and we have never really agreed which is why we don't have a UK-US trade deal. Those are the real sticking points.”. Demands to allow chlorinated chicken and hormone-fed beef have long proved undesirable to British customers. While the EU is trying to cut back on the amount of chemicals in their food, the US continues to use items such as chlorine to remove traces of pathogens, the i reported.
In December the US appeared to change tactics to push Britain to allow tariff-free access to high-quality American meat, as the UK appeared unwilling to budge on food standards. But any deal on American meat could make Labour even more unpopular with British farmers, who are already at odds with the Government over changes to inheritance tax. The previous Tory administration’s decision to sign a trade deal with Australia and New Zealand has also been compared to throwing “British farmers under a bus” by the Liberal Democrats.
MPs recently urged the Government to ensure British farmers will not have to compete with products produced to lower animal welfare standards - for example, battery hens or the indiscriminate use of antibiotics. In December Labour reassured MPs it would not lower animal welfare standards in future free trade deals, in a sign that the UK is unlikely to budge on food standards. Prime Minister Keir Starmer may also remain resistant to providing the US with access to the NHS.
Full access to the NHS is expected to be a key demand from the US when fresh talks begin with the UK, Downing Street was warned last month. Experts warned that the US will want access to the NHS in areas such as drug pricing and patients if the UK wants to secure a “full fat” deal and avoid sanctions. “That is certainly what Big Pharma will ask Trump to champion,” Liam Byrne, Labour chair of the Commons business and trade committee, said.
Byrne said: “American drug firms want a looser regime from Nice [the National Institute for Health and Care Excellence] when it comes to drug pricing. They will argue that Nice needs to focus more on value than price. “But the bottom line to that is they’re seeking freedom to sell more US medicine at higher prices to the NHS. “And the NHS is obviously a monopoly buyer, so has real power to drive prices down. I’m sure Big Pharma will make that case to Trump. Whether he would put that front and centre we have to see.”.
During his last term in office, Trump said the NHS could form part of a "phenomenal" potential transatlantic deal made between the UK and US after Britain left the EU. But Government sources told the i newspaper that the NHS remains a red line for the UK. While Britain has left the EU its ties to the world’s largest trading bloc could remain an obstacle to a trade deal with the US and could perhaps lead to the UK being hit with similar tariffs.