Prospects for an early post-Brexit trade deal between Britain and the US are remote, despite what British ministers may hope for and recent comments from the man being inaugurated as US president today.
On this side of the Atlantic, Theresa May set out her vision of Brexit and the UK’s negotiating position in in her Brexit speech earlier this week. For the first time since the referendum last June, we now know what “Brexit means Brexit” actually means.
Brexit means leaving the single market and not seeking to replicate any existing trade arrangement as those enjoyed by countries such as Norway, Switzerland or Turkey. As part of this strategy we would be rejecting the EU common customs tariff thereby allowing the UK the autonomy to enter into beneficial trade deals with non-EU countries such as the US.
The prime minister’s speech addressed immigration, the European Court of Justice, the fate of EU nationals in the UK, nuclear weapons and crime and security co-operation. German cars, French agriculture and Spanish fishing all got a mention too. You name it, the kitchen sink appeared to be in there as May meandered through the kaleidoscope of UK-EU issues.
But there was a metaphorical elephant standing behind her that didn’t get a mention: Donald Trump, who later today will be inaugurated as US president.
Trump has already made it clear that he wishes Brexit to be a success for the UK, embracing a hostile stance to the EU as an institution. That aggressive tone has put enormous pressure on EU allies already perplexed by attacks on the German chancellor, Angela Merkel, and the credibility of Nato.
In the president-elect’s first UK interview, conducted by Michael Gove, the former justice secretary, and published in The Times, Trump indicated that the UK was “so smart in getting out” of the EU, and he promised a quick trade deal between the US and the UK after he took office.
But putting aside the soundbites, as the European Commission confirmed following Trump’s comments, it will not be legally possible for the UK to enter into any separate international trade deals until it leaves the EU. Only Brussels has the exclusive authority to enter into trade deals on behalf of member states.
Therefore, the earliest the UK could possibly enter into an autonomous trade deal with the US would be two years from the issue of an Article 50 notice, which is scheduled for March 2017, or when the UK ceases to be a member of the EU, whichever is the later.
Realistically, this is unlikely to be 2019 and will almost certainly take much longer.
As with so many of the optimistic pronouncements by the UK government about non-EU countries’ trade agreements we have heard in recent months, the reality is that a beneficial trade agreement with the US is not probable any time soon and is likely to be many years away.
This article first appeared in The Brief, a daily e-newsletter produced by The Times