US president Joe Biden ditches trade deal talks with Britain over fears of job losses

US president quietly abandons talks as he focuses on elections next year

Joe Biden has dashed hopes of a post-Brexit transatlantic trade deal with the UK as he looks to bolster US industry as part of his bid for re-election.

The talks that were set to start in October were abandoned over opposition from members of Mr Biden’s Democratic Party in the US Senate, according to Politico. There was also a failure to agree on how big such a deal should be.

But ministers have not given up, according to Whitehall sources speaking to The Daily Telegraph, who say the agreement could be revived under a second Donald Trump administration following the US election in November.

The negotiations over a post-Brexit trade agreement have, at least in theory, been ongoing since 16 October 2018, when then-president Trump’s trade envoy, Robert Lighthizer, sent notification to Congress of the administration’s intent to open talks after the UK exited the European Union in March 2019.

The talks were officially launched at the height of the Covid-19 pandemic but not much progress occurred between then and when Mr Biden’s administration took power following Mr Trump’s ouster in the 2020 presidential election.

Since then, London has seen the coronation of a new sovereign and the rise of two other Conservative prime ministers, who have failed to gain much movement on any trade deal save for quiet plans for a “foundational” agreement that were supposed to kick off in the autumn.

But one British and one American source have told Politico that the negotiations, such as they were, are now off. “I don’t think we’re going to see that re-emerge,” said one of the sources.

British exports to the US accounted for 17 per cent of all exports as of June, but reaching a trade deal with London has not been a priority in Washington.

Mr Trump’s predecessor, Barack Obama, famously said in the run-up to the 2016 Brexit referendum that the UK would be “at the back of the queue” for any such deal were the British people to vote in favour of leaving the European Union.

Barack Obama famously said the UK would be “at the back of the queue” for a trade deal were the British people to vote in favour of leaving the EU (Getty)

Having done so, British exports lost the favourable terms they received when the UK was part of the EU. And while the lack of progress in talks has been a bone of contention between No 10 and the White House, the American government has not been eager to enter into any agreements that could undermine Mr Biden’s reputation as a champion of organised labour.

Since taking office, the 46th president has made a point of pushing for worker protections in all international trade agreements, but the lack of robust labour standards in an outline for a US-UK proposal that circulated earlier this year raised hackles among Senate Democrats, many of whom are, like Mr Biden, outspoken allies of the US labour movement.

A spokesperson for one such senator, Oregon’s Ron Wyden, told Politico that US-UK trade talks “should be driven by substance” and expressed the senator’s view that no trade deal should be announced until one “that benefits Americans is achievable”.

The spokesperson also stressed that the US Congress “must have a clear role in approving any future trade agreements” said Mr Wyden, who “believes it is important for USTR to be significantly more engaged with Congress on any future negotiations”.

It appears that Mr Biden’s negotiators were quite insistent on including protections for US labour as a condition of any trade deal.

Another source briefed on negotiations told Politico that the “vibes were quite tough” when American and British negotiators last met, with the Americans having “doubled down” on insisting that London adopt what the source said the US delegation described as “worker-centric trade policy”.

The first source also described the American negotiators as being “very focused” on “labour standards”, as well as “on environmental issues [and] these very worthy things”.

According to The Telegraph, a Whitehall source has suggested that a return to the White House by Mr Trump could help the chances of the long-coveted deal.

“When an agreement was being drawn up, it was because Trump had said that a trade deal with the UK was a possibility, so a non-Biden White House might be more amenable,” the source said.

When asked about the abandonment of the trade deal, the prime minister’s official spokesperson told The Independent that the US remained the UK’s biggest trading partner with £310bn in annual trade.

They added: “We’ve achieved all of that without a free trade agreement and through the compatibility of our economies, our commitment to open trade and the strength of our respective industries.”

They continued: “There is a focus on... reducing those few barriers that remain to uninterrupted trade, and we’re creating new opportunities for businesses on both sides of the Atlantic. That is what the Atlantic Declaration is focused on, that’s the work that is continuing.”

The Independent has contacted the White House for comment.