Last reviewed 11 August 2023
A comprehensive Free Trade Agreement with the USA continues to look very unlikely, but the UK and USA sought to deepen the transatlantic relationship by agreeing an Atlantic Declaration in June.
At the same time the Department for Business and Trade continues to work on closer trading links with individual US states. Utah became the fifth state to sign a Memorandum of Understanding (MoU) on trade with the UK in June, following on from Indiana, North Carolina, South Carolina and Oklahoma. The DBT is also in active discussions with Texas, California, Colorado, Florida and Illinois to strengthen trade ties.
Although there was no talk of a UK–US FTA, the US President and UK Prime Minister meeting in June did agree on “The Atlantic Declaration: A Framework for a Twenty-first Century US–UK Economic Partnership”, to allow the two countries to work together more closely across economic, technological, commercial and trade relations. A new action plan is set out for co-operation in certain areas to strengthen supply chains, develop the technologies of the future and invest in one another’s industries.
The action plan includes:
Working together to reduce vulnerabilities across critical technology supply chains. The UK and US will launch a new civil nuclear partnership to support the critical clean energy industry, their net zero ambitions and to keep Russia out of the global civil nuclear power market.
A new approach targeting specific areas for economic advancement such as a new UK–US Data Bridge making it easier for around 55,000 UK businesses to transfer data freely to certified US organisations. It also includes the launch of negotiations on a Critical Minerals Agreement
Stepping up international efforts to ensure the safe and responsible development of AI, starting with an international summit on AI safety to be hosted in the UK later this year.
Enhancing co-operation on measures to stop their adversaries from developing and acquiring sensitive technologies that can be used to harm them.
Research collaboration on important future technologies, AI, future telecoms (5G&6G), quantum, semiconductors and engineering biology
New opportunities for investment in one another’s economies
Negotiations are to start immediately on many aspects of the partnership, including on a Critical Minerals Agreement. An agreement would give buyers of vehicles made using critical minerals processed or mined by UK companies access to tax credits in line with the US Inflation Reduction Act.
Utah had a GDP of £201 billion in 2022 and the MoU aims to unlock export opportunities for UK businesses, to encourage investment and create jobs in the UK. The MoU with Utah is the first with a US state to include fintech as a priority sector. It also promotes co-operation on aerospace, an industry which employs over 100,000 people across the UK, building on shared expertise in areas such as small satellites.
Another area of collaboration is on supply chain resilience, including critical minerals, capturing Utah’s position as a major source of critical minerals for the US market and supporting the UK’s critical materials strategy. The agreement will also facilitate joint work on life sciences, building on the UK industry which generated £94 billion in turnover in 2021. The MoU seeks to expand market access in areas such as government procurement and recognition of professional qualifications to help each side to deliver services to the other.
A second working group meeting was held in June in Manchester with North Carolina under the MoU which was signed last July. The focus was on advancing co-operation in future mobility, workforce development and advanced manufacturing to help UK companies in the automotive, clean energy and aerospace sectors to win government procurement contracts and drive trade growth.