UK-US trade deal: Mike Lee calls to ‘strengthen relationship’
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And experts today predict the UK economy is set to return to pre-Covid levels by the end of 2021, a year earlier than expected. Britain was caught up in a tit for tat battle between the US and the EU over aerospace subsidies that led to massive border fees being imposed on some exports. The Scotch whisky industry is estimated to have lost more than £600million in exports after being hit by 25 percent levies on each bottle.
Ms Truss and US counterpart Katherine Tai agreed to lift retaliatory tariffs for five years after talks in London.
The International Trade Secretary said: “This deal will support jobs across the country and is fantastic news for major employers like Scotch whisky and sectors like aerospace.”
She said it “draws a line under an incredibly damaging issue” and means the Government can focus on “taking our trading relationship with the US to the next level”.
Ms Tai said reaching an agreement marked a “great step forward for our special relationship”.
The row raged for 17 years but escalated in the last few years after the World Trade Organisation found both sides had broken subsidy rules.
Washington hit the EU with tariffs on £5.6 billion worth of goods in retaliation for state support given to Airbus.
Brussels responded with tariffs on £3 billion of American goods over subsidies given to Boeing.
The agreement lifting the tariffs also benefits pig farmers, Stilton makers and cashmere producers.
Ivan Menezes, chief executive of drinks firm Diageo, said: “This deal will safeguard thousands of jobs across Scotland and the rest of the UK.”
Karen Betts, chief executive of the Scotch Whisky Association said the deal is “very good news for Scotch whisky” after two “extremely damaging” years.
Ms Truss secured a four month suspension earlier this year after working closely with Washington to end the charges as soon as the UK left the EU’s single market.
Government insiders said “Liz made all the running in sorting this issue out” and Brussels has “rode in off the back of that” to also strike a deal with the US.
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The trade boost comes as economists predict Britain’s economy will bounce back by the end of the year.
Growth is expected to hit 8.2 percent this year and 6.1 percent in 2022 and the peak in unemployment will be lower than was previously forecast.
The rapid rollout of vaccines and the “unleashing” of pent-up demand means the recovery is a year ahead of its previous forecasts.
Despite delays to the end of lockdown, the economy is still poised for “considerable” growth in the next few months.
Household spending is set to increase by 3.6 per cent this year and seven percent in 2022.
Extending furlough into autumn and expectations of a stronger economic recovery will lead to a lower peak in unemployment, according to the report.
Real household incomes will rebound in 2022, rising by 3.1 percent.
But business investment will remain five per cent below levels seen before the pandemic struck.
Recruitment difficulties causing global supply bottlenecks that are “stoking pricing pressures”, the report warns.
Aviation and events industries are also expected to take much longer to recoup their losses than the rest of the economy.
CBI director general Tony Danker said there are “really positive signs” about the economic recovery ahead.
“The data clearly indicates that there is pent-up demand and ambition across many sectors.
“The imperative now must be to seize the moment to channel this investment into the big drivers of long-term UK prosperity.
“That’s why it’s the right time for Government to come forward with far more detailed plans on everything from decarbonisation, to innovation to levelling up.
“Clearly this does not apply to the hardest-hit sectors from the pandemic who even now face continued delays and genuine challenges to stay viable.
“It would be devastating for hospitality, events or aviation businesses to fail on what we hope is the last leg of restrictions.”
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