The Possibility of a Free Trade Agreement Between Britain and America Post-Brexit

In the wake of British exit from the European Union (Brexit), the quest for a free trade agreement with the United States has been a significant topic of discussion. This article explores the feasibility of such a deal, particularly in the context of a potential re-election of Donald Trump as President. We will also discuss the implications of the Good Friday Agreement and the challenges posed by the Northern Ireland Protocol.

Understanding Free Trade Agreements

A free trade agreement (FTA) is a treaty between two or more nations that allows for the removal of trade barriers and tariffs. Essentially, an FTA ensures that goods and services can be traded freely between the signatory countries without stringent regulations. However, the realization of such an agreement is not straightforward, and numerous factors need to be considered.

The Complexity of Achieving Equality

For an FTA to succeed, there must be relative equality between the two trading nations. In the case of Britain and America, equal footing is nearly impossible to achieve due to a multitude of socioeconomic and legal disparities. To illustrate, consider a simple scenario: fishing.

When two countries have similar economic conditions, a free trade agreement can be straightforward. Each can sell their products freely in the other's market, similar to two fishermen who can sell their catch in each other's ports. However, when one country possesses significant advantages, such as a well-developed infrastructure or government subsidies, the balance is disrupted.

Case Study: The Impact of Subsidies and Cheaper Goods

A vignette to illustrate this is a hypothetical situation where the U.S. builds massive, government-financed container ships that vastly outcompete British fishing vessels. If these ships flood the market with cheap and abundant fish, it would have a devastating impact on the British fishing industry. To prevent such an outcome, an FTA must be carefully balanced and monitored to ensure fairness.

Legal and Regulatory Hurdles

Changing the laws and regulations to achieve this balance is a long and arduous process. In several advanced economies, it takes years, if not decades, to change fundamental legislation. Even after such changes, it may take additional years for them to be fully implemented and applied across the nation. Given this timeline, an FTA is not achievable in the near term.

Implications of a Potential Re-Election of Donald Trump

President Donald Trump has been vocal about his desire to negotiate a free trade deal between the U.S. and the U.K. However, the complexity of the issues involved and the need for legislative and regulatory changes make it challenging. If Donald Trump were to be re-elected, the true feasibility of this agreement would remain uncertain.

Challenges Post-Brexit

Since the U.K. has already left the European Union, the focus now shifts to its trade relationships with other nations, including the United States. Trade relations with the EU still enjoy significant advantages, and any FTA with the U.S. may not provide notable benefits.

The Role of the Good Friday Agreement and Northern Ireland Protocol

Another critical factor is the Good Friday Agreement and the Northern Ireland Protocol. The Northern Ireland Protocol has been a contentious issue, and its potential repeal could significantly impact future trade negotiations. Any unilateral decision to renege on this agreement could derail any future FTA attempts.

Guarantees and Concerns

Even if a potential agreement with the U.S. is reached, there are several concerns regarding the quality of goods and foodstuffs exported to the U.K. market. There is a risk that dangerous products, particularly from the U.S., could be re-exported to the single market, posing significant risks to British consumers.

The Future of Britain's Trade Relations

While the U.K. seeks to establish new trade relationships, the current landscape poses significant obstacles. The need for legislative changes, the impact of the Good Friday Agreement, and the potential re-exportation of dangerous goods are just a few of the challenges. A realistic assessment suggests that achieving an FTA with the U.S. remains a distant possibility, especially without resolving these underlying issues.