USA exports to the UK after Brexit
The UK’s narrow percentage between a Leave and Remain vote in the June 23 EU referendum has since painted a particularly dark picture of worldwide economic uncertainty.
Immediately following the announcement, pound plummeted to its lowest since 1985, and though it has since seen some initial recovery, the future of the wider economy still remains unclear and market instability will arguably linger for some time.
So what does a Brexit Britain mean for USA exports to the UK?
The UK has been a staging post for European trade from the USA for decades, and the effect on the foreign exchange markets in reaction to the Brexit vote will undoubtedly affect the UK-USA exporting relationship.
Though it’s understandable for USA businesses to be cautious, it is important to also be aware of the potential opportunities and benefits of spending money on low-cost investment in the UK. The value of the pound has plummeted, and as a result, businesses that regularly buy services, components and goods in the UK will see a lasting increase in significant discounts. Businesses in the USA that provide services to UK companies can also benefit as UK goods prices become more competitive and they sell more here in the USA. Acting now gives companies the perfect opportunity to steal a march on competitors who are erring on the side of caution and avoiding investment.
It is suspected that long-term, the UK will be offered an unwelcome deal from the EU, both as a reaction to its decision to leave and to set an example to other EU countries who may consider following a similar path. This, again, has the potential to open up new USA trading avenues, whose businesses will likely benefit from deals surrounding USA exports to the UK.
USA political figures are already in talks regarding a potential USA-UK trade agreement, and though it will likely be a minimum of two years before negotiations can begin, our ‘special relationship’ and common language can hopefully help towards an optimistic exporting future after Brexit.