‘Reckless’ approach to US trade talks

The UK Government’s approach to a trade deal with the United States poses a significant risk to Scotland’s economy, Minister for Trade Ivan McKee has warned.

The Scottish Government estimates that loss of friction free-trade with the EU would lower GDP by 6.1% by 2030. By contrast, analysis by the UK Government shows a free trade agreement with the US would only increase UK GDP by up to 0.16%, meaning the deal fails to make up for the loss from the single EU market. 

Despite repeated calls for Scottish interests and standards to be protected by prioritising EU trade talks over an agreement with the US, the UK Government has published its negotiating objectives for an agreement without any meaningful engagement with the Scottish Government.

Last month Mr McKee wrote to the Minister of State Rt Hon Conor Burns warning that the trading benefits and standards of the EU cannot be replicated through any other deal and is yet to have his concerns fully addressed.  

Mr McKee said:

“We have repeatedly called for a proper and meaningful role in any trade arrangements and for the punitive US tariffs on Scottish products - whisky, food products and textiles - to be removed, but the UK Government continues to recklessly pursue a US trade deal without effectively engaging with the Scottish Government.

“This deal will fail by a large margin to compensate for the loss of full access to the single European market, and prioritising a deal with the US over the EU poses significant risk to Scotland’s economy and jobs.

“The UK Government’s own analysis shows young people will be disproportionately affected by a US trade deal as well as risks to food and environmental standards. Furthermore, as we face a global climate emergency, it is unacceptable that the UK Government is seeking to compound the harm of leaving the EU by signing up to a US trade deal that will increase emissions.

“I will stress once again that no trade deal should endanger our close alignment with the EU. Despite this, the UK Government has set an unreasonable timescale for a deal with Brussels and are already talking about walking away.

“As a responsible government we will do all we can through our devolved powers to maintain the closest possible ties with the EU and protect existing high standards. The attitude of the UK Government on trade, and to our economy, once again demonstrates why Scotland would be better as an independent country.”

Background:

Last month Ministers called on the UK Government to prioritise trade talks with the EU over the USA, and give Scotland a meaningful role in all stages of any future trade arrangements.

The Scottish Government has identified the following key areas of concern for the talks ahead:

• protecting our public services
• protecting our environment and positively contributing to achieving our net zero target
• as a minimum, maintaining alignment with EU standards
• building a fairer society, reducing inequality and improving economic wellbeing through inclusive economic growth
• being a good global citizen and helping to raise standards through trade

The Scottish Government has announced that a new Continuity Bill will be introduced to the Scottish Parliament which will make it easier to align with future EU standards in areas such as the environment and human rights. 

The latest State of the Economy report found Brexit uncertainty resulted in significantly lower growth for the Scottish economy in 2019.