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Money Trump and Johnson line up 'massive' trade deal. But the experts aren't so optimistic

12:06  27 february  2020
12:06  27 february  2020 Source:   cnbc.com

Trudeau tells U.S. lawmakers he's confident USMCA bill will pass Commons

  Trudeau tells U.S. lawmakers he's confident USMCA bill will pass Commons MUNICH — Prime Minister Justin Trudeau is telling U.S. lawmakers that he's confident his Liberal government will "have the votes" for the House of Commons to ratify the new North American trade deal in the coming weeks. Trudeau made the comments during a meeting today with a congressional delegation on the margins of a global security conference in Munich. He thanked members of the Senate and the House of Representatives — a bipartisan group led by Republican Sen. Lindsey Graham — for their support for the new U.S.-Mexico-Canada Agreement, which Congress passed late last year after House Democrats negotiated significant changes.

The U.K. is about to start trade negotiations with the United States, but some experts doubt they'll achieve a far-reaching deal anytime soon. Moritz Kraemer, chief economic advisor at advisory firm Acreditus, said that in principle negotiations should be smooth, but there are a "series of rubs."

Brexit war is back: Boris Johnson tears up pledges of 'level playing field' with EU as he sets out vision for Canada-style trade deal despite Brussels already having rejected the idea. The EU wants to talk about fishing first, but the UK says it must be considered as part of a wider package.


Donald Trump, Boris Johnson are posing for a picture: Britain's Prime Minister Boris Johnson (R) welcomes US President Donald Trump (L) to the NATO summit at the Grove hotel in Watford, northeast of London on December 4, 2019. © Provided by CNBC Britain's Prime Minister Boris Johnson (R) welcomes US President Donald Trump (L) to the NATO summit at the Grove hotel in Watford, northeast of London on December 4, 2019.

The U.K. is about to start trade negotiations with the United States, but some experts doubt they'll achieve a far-reaching deal anytime soon.

The two countries announced in January their intention to conclude an agreement in 2020. Speaking at the World Economic Forum, Commerce Secretary Wilbur Ross said that both economies are similar and "it should be much easier" to reach a deal, as a result. However, analysts are only expecting a "shallow" agreement, given the upcoming U.S. presidential election and recent disputes over 5G and digital taxation.

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  Vote at Commons trade committee to set pace for new NAFTA review A contentious motion Justin Trudeau has characterized as a "near miss" will come to a vote at the Commons trade committee today, immediately after Deputy Prime Minister Chrystia Freeland makes her case for swift passage of the implementation bill for the revised North American trade agreement. When the committee last met on Feb.

Johnson earlier stressed that he wants a Canada-style free trade deal , but refused to sign up to regulatory alignment, which would oblige Britain to follow the EU on various standards. “In the very unlikely event that we do not succeed, then our trade will have to be based on our existing Withdrawal

SIGN UP . President Donald Trump on Friday said he doesn' t think he needs to strike a trade deal with China before the 2020 presidential election. Trump also said he is "not looking for a partial deal " with Beijing, moving away from his suggestion last week that he would consider an "interim deal ."

"I don't have high expectations and don't expect anything major to happen soon. There are both political and technical obstacles standing in the way of a comprehensive trade deal between the two," Fredrik Erixon, an international trade expert at the Brussels-based think tank ECIPE, told CNBC Tuesday.

The British government announced in late January that Huawei will be allowed to participate in the country's 5G network, though with some restrictions. This decision was not been welcomed by the White House, where officials believe that the Chinese firm poses a security threat. At the same time, the U.K. has also said it will go ahead with plans to tax tech giants, which are mostly large American firms. The U.S. believes such a tax discriminates against their homegrown companies.

Freeland blasts Tories, but thanks NDP for support on pushing new NAFTA forward

  Freeland blasts Tories, but thanks NDP for support on pushing new NAFTA forward OTTAWA — Deputy Prime Minister Chrystia Freeland has offered effusive thanks to New Democrats and stinging criticism of the Conservatives after the NDP supported the minority Liberal government's efforts to more speedily ratify the new North American trade agreement. Freeland said the government wanted to end study by a House of Commons committee of the new deal, which replaces the quarter-century-old North American Free Trade Agreement.

British Foreign Secretary Boris Johnson has praised Donald Trump ’s ham-fisted approach to deal -making, suggesting the UK would be better off if Johnson was extolling the virtues of Trump ’s negotiating skills, which have, so far, put the US at the brink of a trade war with Europe and left the

WASHINGTON — President Trump upended America’s traditional, bipartisan trade policy on Monday as he formally abandoned the ambitious, 12-nation Trans-Pacific Partnership brokered by his predecessor and declared an end to the era of multinational trade agreements that defined global

Moritz Kraemer, chief economic advisor at advisory firm Acreditus, said that in principle negotiations should be smooth, but there are a "series of rubs." He cited the dispute over 5G, digital taxation and President Donald Trump's "America First" approach as some of the obstacles.

"While both sides claim that a comprehensive deal is possible this year, that remains doubtful. The U.S. side will be absorbed by the nearing presidential election and the U.K. side should have its hands full negotiating with the EU," Kraemer said via email.

In addition, given the time pressure to conclude a deal before the end of the year, analysts do not expect anything broad or wide-ranging.

"It is our expectation that, although it will not be signed, much less ratified, before the U.S.'s November 3 election, there will be significant progress toward the U.S.-U.K. Free Trade Agreement (FTA) by then. That said, the noise about the FTA will be louder than the actual substance of the deal," Anna Rosenberg, head of Europe and the U.K. at the advisory firm Signum Global, said in a note to clients.

Freeland agrees to NDP trade pitch in return for new NAFTA support: letter

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The trade dispute, including the US ban on tech giant Huawei, has dominated bilateral talks between Donald Trump and his Chinese counterpart Xi Jinping, but the US leader is not sure if the two sides are ready to strike a deal . However, before meeting Xi face to face, Trump seemed less optimistic

Trump 's decision to reconsider joining the TPP opens up another potential line of attack for some After Trump pulled the U.S. from the 12-nation deal last year, the remaining 11 countries agreed to a Trade is one of several issues on which Trump has broken with the policies Republicans have

Brexit in the way

The U.K. left the European Union on January 31, but it is still bound to follow EU rules until the end of a transition period, due to last until late December. In the meantime, U.K. officials can negotiate trade deals with other countries, but these can only take effect from the moment that transition period ends.

During this time, the British government will also be busy figuring out new commercial links with the EU. This could further complicate negotiations with the United States.

"EU-U.K. trade discussion will limit the negotiating freedom with the U.S. For example, should the U.K. end up adhering to EU food standards, which we expect in some areas, a deal with the U.S. involving agriculture will be more limited," Rosenberg from Signum Global said.

In 2018, the U.K.'s total trade with the EU reached £641.9 billion ($831.02 billion). In contrast, its total trade with non-EU countries stood at £657.2 billion for that year. The U.K. government has embarked on a trade deal bonanza, looking to reach agreements with various countries to compensate for its departure from the EU. At the moment, the U.K. is negotiating with Canada, Mexico and Ukraine, to name just a few.

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However, reaching a deal with the United States would have a bigger impact given the current level of commerce between the two. In 2018, the U.S. topped the U.K.'s list of single-country trading partners, with a total trade flow of £190.5 billion ($246.91 billion). Germany came second, followed by the Netherlands and France.

Erixon said that the "magnitude of the gains" from a U.S.-U.K. trade deal "aren't in the same universe as the magnitude of the costs for leaving the EU on bad trade terms."

"A shallow agreement will make both sides able to score some political points and get some small economic gains, and that is probably all that they could wish for," he added.

Niclas Poitiers, a research fellow and trade expert at the Brussels-based think tank Bruegel told CNBC that it is "simply impossible" to compensate for the economic impact of Brexit with a U.S. trade deal.

"The EU Single Market is by far the most comprehensive commercial relationship in the world, and of a similar size as the U.S. market. Furthermore, geography and integrated value chains play an important role, as do areas of specialization," he said via email, highlighting that the U.K. and U.S. are both competitive in the service sector.

New NAFTA beats no NAFTA, gov't says, but no big economic boost coming for Canada .
The federal government's much-anticipated economic impact study of the revised North American trade agreement does not forecast a significant economic boost when the deal takes effect, but officials from Global Affairs Canada told the Commons trade committee Wednesday it's preferable to having no deal. Although Justin Trudeau's government has touted the successful renegotiation as a significant win for Canada, most of the effects in the forecast are relatively small.Implementing the new Canada–U.S.–Mexico agreement (CUSMA) would provide a modest boost to Canada's gross domestic product of 0.

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