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    BW4_Trade

    The UK to yield up high food standards to the US?

    150 150 ioana bere

    “What the US failed to obtain from the EU, it is now trying to gain from the UK”, says a blog post by Brexit and Environment. The US is pushing for the inclusion of its meat that’s produced to lower standards in a future trade deal with the UK. The 2020 annual report by the US Trade Representative features complaints about the EU’s “unscientific ban” on meat produced using hormones and other growth promotants. US Trade Representative, Robert Lighthizer, stated earlier this week that the US will not sign a free trade deal with the UK unless its farmers can sell meat and other agricultural goods to Britain without barriers.

    The UK government has always said it opposes the import of products such as chlorinated chicken, but is starting to backtrack on this. A recently leaked Downing Street memo called for “no specific policy” on animal welfare in the US trade talks. The Brexit and Environment blog suggests this matters for the UK’s future regulatory identity: will it stick with the precautionary principle adopted by the EU, or will it shift toward the risk-based approach embraced by the US? The UK’s apparent willingness to accept lower US standards also has repercussions for the EU-UK negotiations, as it makes it increasingly hard for the EU to accept only political commitments for a level playing field.

    The future UK-US trade deal raises concerns among UK pork producers as well. They fear they will not survive competition from US pork, which has production costs about half that of the UK due to lower welfare standards and growth-enhancing feeds. Last month, the government refused to legally enshrine a “level playing field” on welfare standards in the Agriculture Bill.

    Brexit & Environment, Chlorinated chickens cluck again
    2020 National Trade Estimate Report on Foreign Trade Barriers
    US Trade Representative, Robert Lighthizer statement
    The Observer on the leaked Downing Street memo
    Financial Times on the UK pork producers

    UK’s trade negotiation objectives: a shift towards US’ risk-based approach

    150 150 ioana bere

    The UK might pivot to a risk-based approach, according to a briefing by the Trade Justice Movement (a UK coalition of sixty civil society organisations). This is specific to US regulations and contrary to the EU’s precautionary principle. The briefing compares the UK’s negotiation objectives with the EU and US and points to important differences between the two. On environmental policy, it shows the UK is short on detail and enforceability in both of the negotiation mandates. None mentions the Paris Agreement, although the US one points to the net-zero target and the need for a dispute settlement to ensure enforceability (which is specifically excluded in the EU mandate). Including such reference can be considered encouraging according to Trade Justice Movement, as the US negotiators asked for climate change not to be included in the deal (revealed in leaked papers last year). 

    Trade Justice Movement’s report
    UK negotiation mandate with the EU
    UK negotiation mandate with the US

    UK shows worries about US environmental dumping

    150 150 ioana bere

    The UK government asks for a level playing field in the ambitious and comprehensive free trade agreement it is aiming for with the US. It is less forceful than what the EU is asking from the UK, but it indicates that the government is worried about getting too close to the US and losing some environmental and labour protection.

    The adopted negotiation approach mentions the need to “secure appropriate provisions that promote open and fair competition”, which resembles the EU’s level playing field requirements. More specifically, on trade in services the UK asks for “ambitious commitments on market access and fair competition”. On competition law, the UK wants an ambitious chapter, with similar wording to the mandate with the EU.

    The UK government says the agreement will ensure high environmental and social standards and protections. The deal should also have appropriate mechanisms for the implementation, monitoring and dispute resolution of environmental and labour provisions. This is completely different from the UK negotiation mandate with the EU, where it specifically states that environmental and labour provisions should not be subject to the dispute resolution mechanism.

    An impact assessment backing the negotiation approach with the US finds that the UK outperforms the US in most environmental indicators, such as climate and energy, water resources, biodiversity protection and air pollution.

    The UK’s approach to trade negotiations with the US

    US pressures UK to diverge from EU standards

    150 150 ioana bere

    (27 November 2019) Leaked confidential documents of UK – US trade working group meetings over the last 30 months give new insights into how the US is pushing the UK to divert from EU regulatory approaches and standards.

    The papers show the US prefers a regulatory autonomous UK post-Brexit. Rolling back EU legislation would facilitate future alignment with the US regulatory system, and would also suit US business interests. During these meetings, US trade representatives highlighted the “philosophical difference” between the US and EU approaches to food and environmental regulations. The US is also allegedly threatening to refuse any future trade agreement with the UK if it agrees to remain aligned with the EU. It is made clear in the papers that any mention of climate change cannot be included in a future UK – US trade deal. Additionally, US officials apparently advised UK trade negotiators on how to publicly “sell” the idea of chlorinated chicken to British customers.

    Unearthed article (27 November 2019)
    Open democracy article (27 November 2019)
    Global justice article (27 November 2019)

    A level playing field: the EU’s red line in trade negotiations with the UK, hears Trade Commissioner-designate

    150 150 ioana bere

    (1 October 2019) The significance of a level playing field in the future EU-UK relationship post-Brexit emerged during the hearing of Commissioner-designate for trade, Phil Hogan.

    Danuta Maria Hübner, Polish EPP Member of the European Parliament, raised the importance of ensuring a level playing field and common cross-borders standards. According to Hübner, this would be particularly important when taking into account the proximity and the size of the UK, as well as the current UK government’s position on regulatory divergence. She alluded this should be treated as a red line by the EU.

    Phil Hogan praised the Withdrawal Agreement as a balanced one, with reassuring provisions on the level playing field and standards varying from environment to state aid. He also presumes such a framework should be included in the negotiation mandate for the future agreement. Hogan expects the European Parliament to have its say over such a mandate. 

    Phil Hogan’s hearing in the European Parliament

    UK on deregulatory path, eyeing the precautionary principle…

    150 150 ioana bere

    The UK’s new Prime Minster Johnson declared in his first speech that it is time “to liberate the UK’s bioscience sector from anti genetic modification rules”. EU policy on genetically modified organisms (GMO) is guided by the precautionary principle. At the moment, only one GMO has been granted an EU authorisation for cultivation (MON 810 corn from Monsanto, now Bayer). Nineteen countries, including France, Germany, Italy and Poland, have banned GMO cultivation altogether. Whilst the US, followed by Brazil, is the world’s largest GMO cultivator with over 100 million hectares (around 20% of its farmland).

    Prime Minister Johnson’s international trade secretary, Liz Truss, is portrayed as an ultra-free market ideologue and has in the past spoken in favour of economic liberalisation and deregulation. Last year she also allegedly met US groups to discuss deregulation and the benefits of Reaganomics.

    … but US help is uncertain

    Immediately after the change of power in the UK, some US government representatives declared a readiness to agree a trade deal as soon as possible. They also “enthusiastically” supported a no-deal Brexit which they consider to be a window of opportunity to strike a “very substantial trade agreement”. But Nancy Pelosi, speaker of the House of Representatives, ruled out the House’s support for any trade agreement with the UK which jeopardises the Good Friday Peace Agreement

    Boris Johnson’s first speech as Prime Minister (24 July 2019)
    European Parliament on GMOs cultivation ban in the EU
    The Guardian on Liz Truss
    Politico on US backing no-deal Brexit
    The Irish Times on Nancy Pelosi
    Brexit Watch previous related articles (see under section Trade)

    US continues push for UK trade deal

    150 150 ioana bere

    President Trump’s visit to the UK came amidst comments made by the US Ambassador to the UK, Woody Johnson. According to Johnson, “the entire economy (…) all things that are traded would be on the table” in future UK-US trade negotiation talks.

    He suggested amongst other areas that a future trade deal would have to cover agricultural products, including chlorinated chicken. According to Johnson, British consumers should have the last say, by choosing to buy or not buy US products once they are put on the UK market. This is no new approach, as the US follows the same process in regard to the transatlantic trade deal with the EU. The US Ambassador to the EU, Gordon Sandland, mentioned during the European Business Summit last May that any trade deal with the EU would have to include provisions on agriculture. Public consultations held by the US government have already demonstrated this further, as US companies asked for the “mutual recognition of equivalence in safety measures” (Brexit Watch n°10).  

    Another point of controversy relates to the UK’s National Health Service (NHS). Ambassador Johnson stated this should also be on the negotiation table. This confirms the fears expressed some time ago by Shadow Health and Social Care Secretary, Jonathan Ashworth, who claimed that private healthcare corporations in the US could “get their hands on NHS contracts”. Amidst growing concerns, the incumbent Health Secretary, Matt Hancock, nevertheless made clear that the NHS would not be for sale in any future trade deal talks. 

    The Guardian article on US-UK trade deal demands
    Brexit Watch n°10
    Jonathan Ashworth’s interview on NHS

    NGOs analyse the EU-UK trade battle field

    150 150 ioana bere

    Environmental law group Client Earth has set out its demands for an overhaul of the UK International State Dispute Settlement (ISDS) mechanism for a future EU-UK trade deal. The current mechanism applied (in all EU trade agreements concluded post-2000) is described as the “most illegitimate dispute settlement mechanism in international law” (Professor Alessandra Arcuri), and is often used as a threat against regulation. Professor Arcuri and Friends of the Earth campaigner, Lora Verheecke, suggested that any form of EU-UK ISDS should take into account the need to provide better guarantees to communities’ rights, as well as a series of obligations and legal responsibilities for investors.

    Recording of “Brexit and the environment: What’s next” event
    Client Earth report on ISDS

    9 out of 40 trade continuity agreements signed by the UK

    150 150 ioana bere

    The UK signed a series of trade continuity agreements to ensure minimum trade disruption after Brexit day. However, it has only secured nine out of 40 trade agreements that the EU has with more than 70 countries and thus will obviously not be able to transfer all the trade deals in time. Covered by these agreements are countries including Switzerland, Norway, Israel, Chile and others. These agreements mostly follow the EU model, even though some might include modifications. The UK’s trade department has allegedly faced difficulties in replicate the EU’s treaty with Japan, as Tokyo is pushing for a better deal. 

    UK Trade department guidance
    BBC article
    Financial Times article

    US NGOs warn about the risks of a future UK-US trade deal

    150 150 ioana bere

    As US authorities commence preparations for a possible future trade deal with UK, stakeholders have been invited to submit their comments. Among the 133 responses, several came from US NGOs. 

    The Sierra Club highlighted the negative impacts trade agreements have had on communities and environment, pushing for a different approach this time. Their main asks concern transparency standards for the negotiations, in requesting US authorities to make public their proposals and promote stakeholder involvement along the process. The environmental organisation also positioned itself against the investor-state dispute settlement system, said to be favourable to corporations that systematically challenge environmental and health standards in arbitral tribunals.

    Along with the Sierra Club, the International Fund for Animal Welfare (IFAW) stressed that a future trade deal must include a strong environmental section. IFAW insisted on the need of addressing marine conservation and providing mechanisms and funds for limiting wildlife trafficking. They also stated that the prospects of a deal should not seek to undermine UK standards, such as those relating to agricultural and pharmaceutical products tested on animals, which are more advanced than many US laws and regulations.

    The Sierra Club’s comments on a future US – UK trade deal
    International Fund for Animal Welfare’s (IFAW) comments on a future US – UK trade deal
    List of 133 replies to the public consultation

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