Limited tariff lightening on the American side
The main American concession concerns the automotive sector: the United States reduces customs duties from 27 % to an annual quota of 100,000 imported British vehicles. This is essentially a partial return to the situation preceding the climbing in the trade war, marked by the “Liberation Day” of Donald Trump of April 2. For Eric Dor, this measure was crucial for London: “Saving car and steel exports was vital. The United States is an important partner for them. “
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Targeted alleviating also affects aeronautics, steel, aluminum and beef. Customs duties on Rolls Royce engines and parts (which produces plane engines), as well as on British steel products, are deleted. A quota of 13,000 tonnes of British beef will also be able to enter the American market without a price, and vice versa, 13,000 tonnes of American beef can be delivered to the United Kingdom without customs duties, but “This beef should be compatible with British health standards, themselves inherited from the European Union“Recalls Eric Dor.
tower“The British did not give in on food standards, especially on the delicious chicken chicken or the famous ox with hormones”
A more ambiguous point lies in the American commitment of a “preferential treatment” for the United Kingdom in the event of future price increases on pharmaceutical products. “”The British Pharma industry is still uncomfortable. There is a vague exceptional promise concerning the United Kingdom, but nothing concrete. If Trump decided to tax the Pharma sector, nothing guarantees that the United Kingdom would be really spared“, Eric Dor. And to add that, paradoxically, part of the commercial litigation between the United States and Europe in this sector is actually”A case between Americans “multinationals like Pfizer or Johnson & Johnson having distributed their world production, often according to tax considerations, of which in part in Ireland, where they are present “consistently “, he recalls.
Targeted British counterparts
Beyond the beef, the International Airlines Group group (owner of British Airways) is committed to buying for $ 10 billion in Boeing aircraft. A signal that is both commercial and political, intended to illustrate transatlantic industrial cooperation.
But the British did not concede everything. “They did not give in on food standards, especially on the delicious chicken chicken or the famous ox with hormones“, Slips, with irony, Eric Dor.”Americans have always accused these standards of disguised protectionism, which is false. The British inherited the European Union standards, which they largely continue to apply“, Recalls Dor.
“Europe has also muscled its speech this weekand showed that the time had come to show the teeth a little, to show that we too can inflict important damage to it, and this without even attacking services, which would however be the best lever. But it’s still the ultimate weapon! “he specifies, in reference to threats brandished by the European Commission on Thursday.
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Tensions with WTO rules
One of the most sensitive points raised by the economist is the legality of this agreement. Under the rules of the World Trade Organization (WTO), any price reduction granted to a country must be extended to all members, except in the context of a global free trade agreement.
However, the agreement between the United States and the United Kingdom only removes customs duties on a fraction of the products exchanged. It therefore seems incompatible with WTO standards. “”Normally, it’s illegal“, tranche dor.”The United States will probably try to plead that this is a first step towards a broader agreement, but this could give rise to a legal battle. And their desire for protectionism and taxes maintained at 10 % shows that this is not the case“He explains, circumspect.
tower“Since the first Presidency Trump, the United States has blocked the appointment of its members. Even under Biden, the situation has not been unlocked. This neutralizes the organization.”
A problem pointed out by the economist: the WTO call organ, which should decide in the event of a dispute, is today paralyzed. “”Since the first Trump presidency, the United States has blocked the appointment of its members. Even under Biden, the situation was not unlocked. This in fact neutralizes the body.“A situation which, according to Eric Dor, participates in”the business of dismantling international trade ruless “, for the benefit of bilateral regimes (between countries) marked by the arbitrariness.”They unravel the WTO, we move away from the defined international rules. Which is worrying. “
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American victims
On the American side, the Trump administration continues its protectionist line, with pricing increases in most products, and derogations targeted for diplomatic purposes. But this strategy has a cost. “”We risk ending up with higher customs rights all over the world, which will weigh on world trade, will slow down economic activity, and increase inflation in the United States, with a direct impact on the purchasing power of American households“, Analysis of Professor Dor.
tower“There will be a direct impact on the purchasing power of American households.”
Finally, the British refusal of giving in to the taxation of digital services or agricultural standards also shows the limits of Washington negotiation power. “”The United States has not obtained everything. And the EU remains by far the first market for the United Kingdom, ahead of the USA. Keir Starmer (British Prime Minister, editor’s note) understood this well: the British economic future remains attached to the European Union. “
