The government is making big things out of signing what are known as MOUs or memorandums of understanding with US states. The latest is one signed with Washington on the west coast of America. It brings the total to six. The official announcement says, “The UK now has deals with six US states with a combined GDP of more than £2 trillion.” More are in the pipeline, including ones with Texas and Florida. The Daily Express hailed it as: Brexit Britain flying high with new £725billion US trade deal with home state of Boeing.
What this confirms, beyond the headline, is not that Brexit has been a success but that it is a failure. We know this for a fact because these MOUs are meaningless. They don’t commit the parties to anything, they are not legally binding, and as far as I know, we could have signed them as an EU member.
This doesn’t even include the fact that measuring a proper trade deal against the GDP of the nation you’ve reached an agreement with is nonsense, doing it with a MOU is just pathetic and ridiculous.
Having to invent benefits of Brexit that plainly don’t exist is not a reason to believe it has been a triumph, it only reveals just how badly Brexiteers know that it’s going.
Professor Chris Grey also picks up on this point:
This is total nonsense. It's another of the non-binding MoUs that will have little or no impact on UK trade, and to measure their value in terms of the size of the US States involved is either dishonest or meaningless. 1/5 https://t.co/PbZyIBtzlj
— Chris Grey 🇺🇦 (@chrisgreybrexit) September 27, 2023
In his thread, he provides a link to a blog post by trade expert Peter Ungphakorn who demolishes the whole case for MOUs and says the one that Penny Mordaunt signed with Indiana was just eight pages long. And while the British government made a big splash about it, aided as usual by the right-wing pro-Brexit press, in Indiana, they hardly mentioned it!
You would have thought a state with a population the size of Yorkshire's would be ecstatic at the opportunity to export to a country ten times its size but no. Not a peep. And what about the fact that it claims UK suppliers would be able to "tender for contracts on the same terms as (“no less favourable than”) suppliers in other US states, including those that have preferences with Indiana except those bordering Indiana — Illinois, Kentucky, Ohio and Michigan."
In other words, the four adjoining US states are preferred to Britain. A trade lawyer, Lorand Bartels says: “That’s the weirdest MFN [Most Favoured Nation] clause I’ve ever seen.”
Plus Indiana has a 'Buy Indiana’ presumption and it’s not even clear if the memorandum would override this commitment. My guess is no.
Even more irrational is the government's insistence that these trade 'deals' (they aren't deals and won't help trade very much) are being pursued relentlessly as if they're a vital piece in Britain's post-Brexit foreign policy while trade with the EU, on our doorstep and with a GDP about 40 times bigger ($16 trillion compared to $420 billion), is regarded as dispensable.
MOUs are partly about removing trade barriers which would indicate the UK government thinks this is a good thing. But Brexit was about creating trade barriers - and with a much larger market. The government seems to believe there is some perfect level of trade barrier that is just right
The Express says: Florida will be next! Kemi Badenoch eyes next mega Brexit deal with huge US state. In the report, they claim:
"A deal with Florida would mean that in the US alone British service industries, including legal and financial services as well as manufacturing, would have unfettered access to a collective £3.3trillion GDP area covered by seven US states."
This again is utter rubbish. We haven't even got 'unfettered access' to Northern Ireland.
Elsewhere the Express, never known for logic or even accuracy, says Germany is bringing in border controls and this means it "looks like Brexit voters were right all along."
There are a lot of people pointing out that Germany is not 'bringing in border controls' - it's part of the Schengen Agreement - but it is introducing more spot checks. Plus, if the headline was partly right it only proves Germany has been able to do something around increasing control of its own border while being a member of the EU. We could have done exactly the same.
This actually proves Brexit voters were wrong, but that won't worry the Express. It's an insane world right now, isn't it?
