Daily Management Review

US Not To Compromise On Trade Interests Despite 'Special Relationship' With UK


US Not To Compromise On Trade Interests Despite 'Special Relationship' With UK
The former United States trade chief, Michael Froman, has said that despite the "special relationship" that the United Kingdom has with the US, London should not expect that any favorable terms in trade will be given by Washington.
He said that no compromise on its own economic interest would be given by the US to the UK.
These comments were made with respect to a new tariffs imposed by the US on a range of goods from the UK, including on Scottish single malt whisky and Scottish cashmere, and which are set to be implemented in a day.
The US administration under President Donald Trump has imposed an import tariff of 25 per cent on whisky, cashmere and a few others as an outcome of the World Trade Organization (WTO) ruling on a trade dispute over subsidies to Airbus where the US was given permission to impose tariffs on goods from the European Union worth $7.5bn which includes the UK along with Germany, France and Spain. It is also expected that early next year, the EU will also be given permission to impose tariffs on US goods by the WTO because the world trade regulator has also held the US responsible for providing state subsidies illegally to the US based plane maker Boeing.
However, the latest US tariffs on UK has been unduly imposed on Scottish businesses, feels businesses there.
However, Froman said that no special treatment from the US should be expected by the UK.
"Just because we have a special relationship, it doesn't mean that we're willing to sacrifice our economic interests in the context of a trade dispute or a trade negotiation," Froman said. "That by the way applies to whatever future trade agreement is agreed between the US and the UK as well," he added.
The Scottish businesses are irked by the US tariffs because they feel that they have been put at a disadvantage because rival single malt whiskey from Ireland and cashmere from Italy have not be e included in the tariffs and hence the Scottish products will lose out on competition in the US.
The Scottish breweries had been unduly dragged into the trade spat between the US and the EU and a dispute in which Scotland businesses or politics had no role to play at all, feels Patricia Dillon from Speyside distillery near Aviemore, reported the BBC. This Scottish distillery will now have to draw out a new plan for the increasing the 60,000 litres of Spey whisky which is currently exported to the US without any tariffs. "We feel we have been dragged into a trade war that has nothing to do with us whatsoever," she said. "A 25% tariff is not something we can absorb, so we have to reconsider our position in the US market."
 At cashmere maker Johnston's of Elgin, chief executive Simon Cotton said the tariffs would put his company at a disadvantage to their main Italian rivals and would limit its future growth plans.
The US was not unfairly targeting the UK, Froman insisted, and argued that similar import tariffs would also be imposed on French, German and Spanish goods by the US.
Froman also said that if the UK is serious about striking a trade deal with the US, it has to choose between some very difficult options.  "The UK in particular is in a difficult position. After Brexit it has got to decide how closely it wants to remain aligned with EU regulations - which is still its biggest trading partner - and how much it wants to open itself up to partners with different standards - like the US," he said.