CORONAVIRUS has suppressed economies around the world, but even in this horrific crisis, our ability to trade has helped us through. It has been international supply chains that have ensured that the UK, and other nations, have been able to obtain the food, the PPE, and medicine we need.
As we emerge from this crisis, we must use international trade as a springboard to prosperity, and a free trade agreement with the US is the best place to start.
Teesside’s industry is key to this recovery. Our capacity for hard work and our commercial nous means we have long been producing goods that have been shipped worldwide. As a centre of the Industrial Revolution, there is one good, above all others, for which we are known – steel.
We already export around the world, with exports of steel, iron and aluminium to the US alone currently worth £890m. Indeed, the US is our largest export market after the EU.
However, high tariffs and burdensome regulations mean we could be exporting so much more.
There is support from the industry for an agreement, with the steel industry body, UK Steel, stating: “A new UK/US Free Trade Agreement would provide a significant boost to our trade to this high-value market, create a global-competitive advantage for UK steel producers, and open up valuable new market opportunities.”
This is why the Government has put the steel industry at the heart of its negotiations with the US –an ambitious UK/US Free Trade Agreement brings big wins.
One win is through reducing tariffs. Currently, they can be as high as 25 per cent, so any reduction will be positive given the scale of transatlantic trade. And we can avoid further punitive tariffs in future.
As part of the negotiations there is also the opportunity to look at reducing those technical barriers that so often hold up trade between nations. By cooperation on regulations, testing and certification procedures, an agreement with the US could reduce compliance costs for businesses and therefore also reduce prices for consumers.
We know that companies which export are more productive, and research has shown that this results in them paying higher wages. The North-East is already exporting, with more than £2,000 of goods exported to the US every minute and a deal with the US could boost our local economy by £140m alone.
By increasing the number of companies which export, we will ensure that we see a high wage, high productivity recovery that allows workers to keep more of the pound in their pocket.
Trade with the US is only the beginning. Yes, a deal with the US could boost British workers’ wages by £1.8bn, but we want more. We want free trade agreements with 80 per cent of the world within three years. Negotiations with Japan are about to start, and Australia and New Zealand are lined up.
Since the discovery of iron ore in the Cleveland Hills in the 19th Century to the present day, the names of our towns have been embossed on steel beams around the world.
Now, at the start of our new trading journey, with the recent investment into British Steel, and our Tees Valley mayor Ben Houchen pledging to bring back steel making, we are returning to our role as the beating heart of the UK steel industry.
Let’s take this opportunity, as the Tees Valley, and trade our way to further prosperity.
Jacob Young is the Conservative MP for Redcar
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