It's often said that a week is a long time in politics. And
as 2016 showed, just one day can transform a nation's political
landscape. If so much can change in 24 hours, what could the next
few months, with the Article 50 trigger in sight, have in store?
Could just a few months – as Ted Malloch, the man tipped to
be the next US ambassador to the EU, believes – be all it
takes to negotiate a free trade agreement between the US and the
This seems quite a stretch, even in this new world of politics,
but I asked our Deloitte trade expert Sally Jones just how
ambitious a 90-day free trade deal really is. She explained that
even taking into account that formal trade negotiations with the US
can't happen until the UK has exited the EU, recent experiences
of other trade negotiations like the TransPacific
Partnership (TPP, eight years of talks),Transatlantic
Trade and Investment Partnership (four years) and the Trade in
Services Agreement (TiSA, five years) gives some perspective
on the time and complexity of such a task at hand.
The positive news for the UK is that the bandwidth of the US
authorities to discuss trade agreements has increased considerably
since Donald Trump's inauguration. He's made clear that
he's not a fan of multi-lateral negotiations and, as such, has
pulled out of TPP, the TiSA is on hold, and most
commentators think TTIP will not progress any further. Mr Trump has
also made clear he doesn't share the previous
administration's view that the UK should be sent to the back of
the trade queue after Brexit.
Yet it remains unclear what the priorities of this new US
administration will be in what are some of the critical trade areas
for the UK such as services, and, in particular, financial
services. The US doesn't show any sign of
favouring a trade agreement that includes financial services,
despite some intense lobbying from Europe during previous TTIP
talks. Therefore, if the City is to remain the conduit through
which the US banks access the entirety of the EU financial markets
after Brexit, an awful lot of stars will have to align, including a
big change of heart by the US Treasury on US bank regulation. But
there is, at least, plenty of goodwill on all sides: Europe wants
the City to still be able to provide finance to its markets, London
definitely wants to retain its status as a global financial
ecosystem and the US banks need to continue to be able to trade
freely in Europe.
While the shared language, business culture and political will
with the US should certainly support the negotiation, it is the
outcome of the UK's talks with the EU, in particular on key
areas such as services, agriculture and procurement that will
undoubtedly influence what any future US-UK free trade deal could
Whether that free trade deal will cover all of the bases that
the UK needs depends on how long both sides are willing to give to
negotiations, and the power balance between them.
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On January 16th 2016, Implementation Day was announced. This marks the day on which the International Atomic Energy Agency verified that Iran implemented its agreed nuclear-related commitments contained in the JCPOA.
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