UK now has EIGHT trade deals with US states - More to come in President Trump's USA?
These 8 US states have a total economy larger than 23 EU countries COMBINED
Montage © Facts4EU.Org 2024
Brexit Britain's US state deals have been racking up, with their markets worth £7.3 TRILLION in GDP.
These represent big wins for Brexit Britain - Why is Starmer pivoting back to the EU?
On 13 March this year the UK and the US state of Texas signed a new Memorandum of Understanding (MoU) to boost trade and investment.
A Brexit Facts4EU.Org exports series
The independent UK selling to the world
PART I - Brexit Britain’s fastest growing export markets for goods and services, 2016 – 2024
PART II - Brexit Britain’s biggest customers last year (2023)
PART III - Post-Brexit, UK exports to Trump’s America grew 57% faster than exports to the EU
PART IV (This report) - UK now has EIGHT trade deals with US states - More to come in President Trump's America?
PART V - The future : Is Starmer's government fixated on pivoting back to the EU and missing a huge opportunity?
Texas is the largest and eighth US state to conclude a trade pact with the UK, bringing the combined GDP to $7.3 trillion – a quarter of US GDP. The pact focuses on key sectors including energy, life sciences, and professional services.
Texas has the second largest US state economy, with a GDP of $2.6 trillion in 2023 – larger than the EU's third-largest economy Italy - making this the UK’s most economically significant trade pact with a US state to date.
Photo left : Dallas Cowboys cheerleaders, 2022.
The trade pact with Texas to boost trade and investment ties between the UK and Texas was signed by the new Conservative Leader (then Business and Trade Secretary) Kemi Badenoch, when she welcomed Texas Governor Greg Abbott to London on 13 March 2024.
These State-by-State trade deals do not of course qualify as full free trade agreements. Nevertheless they are highly significant in removing barriers to trade, particularly in services.
All these trade deals were done under previous Conservative governments
The authoritative and non-partisan House of Commons Library researchers produced an international trade report on 27 September. On the new Labour government’s plans they stated :-
The report on trade deals, end-Sept 2024
by the independent and authoritative House of Commons Library Research Dept
“The Labour government has said that … its priorities will be negotiations with the Gulf Cooperation Council (GCC: Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the UAE), India, Israel, South Korea, Switzerland and Turkey… Negotiations with all these countries had started under the previous Conservative government.”
“The new government’s plans for FTA negotiations did not mention the US … Canada … or Mexico.”
“The government has said that trade policy goes wider than FTAs. It will publish a trade strategy which will align with its industrial strategy and promote the UK’s economic security and net zero aims.”
House of Commons Library report, end-Sept 2024
NOTE : We make important comments about the new Government's approach to doing trade deals in the 'Observations' below this report.
The UK’s largest buyer of goods and services by far – the USA - did not warrant a mention by the new Labour government of Sir Keir Starmer.
Texas plus the other seven states together have a total GDP of $7.33 TRILLION dollars
The Texas deal brought the UK’s tally to eight US states:
- Indiana : $509.3
- North Carolina : $808.8
- South Carolina : $336.3
- Oklahoma : $262.0
- Utah : $288.0
- Washington : $831.9
- Florida : $1,642.2
- Texas : $2,647.6
- TOTAL : $7,326.1 bn
[Source : U.S. Bureau of Economic Analysis, data for 2023.]
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Putting the US deals into context with the EU27
The US is such a vast country it can sometimes be difficult to put it into context with the EU. We therefore analysed the GDP of the eight US states and the 27 EU countries and below we show graphically just how much larger are the collective economies of the eight US states in comparison with EU countries.
Brexit Facts4EU.Org Summary
UK-US state level trade deals
In short, the EIGHT US state deals signed so far involve a GDP so large that in total they eclipse the economies of 23 EU countries combined, as shown below.
© Brexit Facts4EU.Org 2024 - click to enlarge
- GDP of the 8 US states combined : $7.3 TRILLION
- GDP of the 23 EU states combined: $7.0 TRILLION
[Sources : World Bank | U.S. Bureau of Economic Analysis - data for 2023.]
Only two EU countries have economies larger than that of Texas
© Brexit Facts4EU.Org 2024 - click to enlarge
Pictured in our chart: State of Texas flag, Larry Hagman (JR Ewing in 'Dallas'), a pump-jack oil well, Dallas Cowboys cheerleaders, Texas Longhorn cattle.
Commenting on this report, the Rt Hon Sir John Redwood MP told us:
“Great to see the UK using its Brexit freedoms and making trade deals with eight US states with more to come.
“The US is our largest trading partner and we have a much better balance between exports and imports than with the EU. Who said none of this would be possible when we left the EU?"
Sir John Redwood, former Secretary of State and Single Market Minister, 07 Nov 2024
On signing the Texas deal the UK’s then Business and Trade Secretary and now Conservative party leader, Kemi Badenoch MP, said:
“I’m delighted to welcome Governor Abbott to the UK for this landmark signing.
“Today’s signature with Texas marks the UK’s eighth US state-level pact, meaning UK firms now have access to states with a combined GDP of £5.3 trillion - equivalent to a quarter of the whole US economy. This shows our US state-level strategy is working and really delivering for British businesses."
Texas State Governor Greg Abbott said:
“Strengthening the bond between Texas and the United Kingdom is crucial for our shared economies to prosper.“By signing this Statement of Mutual Cooperation today, we will further promote economic growth on both sides of the Atlantic. Texas is the economic engine of America, where entrepreneurs from around the globe can cast a vision and know they can achieve it. Working with our British partners, we will chart a greater path towards success and opportunity and create an even more robust economic partnership.”
It doesn’t stop there…
Active discussions have been underway between the Department for Business and Trade and many other US states, including California, Colorado, and Illinois. What is not currently clear is whether the new government is pursuing these or not.
Observations
The Rejoin movement does not seem to be able to raise its eyes beyond the UK’s backyard. By contrast, the Brexit Facts4EU.Org think-tank team has always looked at the newly independent United Kingdom as a player on the world stage.
Yes, the European market is naturally important to the United Kingdom, but it is ever more important that British businesses look to the faster-growing markets around the world.
The last deal with Texas – and the deals already concluded with seven other US states – was proof that an international outlook which extends beyond the EU’s frontiers opens up a great many opportunities for British companies. This also benefits UK consumers, who will be able to buy a wider range of competitively-priced products and services.
Yet another benefit of Brexit…
The new Labour government's approach to trade deals
In the final report in this pivotal five-part series on 'Brexports', we will look at the new government's apparent indifference to doing deals with the US, preferring instead to pivot back to the much slower-growing and far less important EU market.
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[ Sources: World Bank | U.S. Bureau of Economic Analysis | UK Dept for Business and Trade ] Politicians and journalists can contact us for details, as ever.
Brexit Facts4EU.Org, Wed 13 Nov 2024
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