A “special Trade Relationship” – USA and United Kingdom
Due to the desire for autonomy and sovereignty, the United Kingdom voted to leave the European Union through a referendum. Britain is the EU’s largest market and biggest economic contributor and with their 500 million customers, they can separate from the market and start their own trade with other countries while strengthening their self-power. Also as a member state, the UK must obey to the rules and policies surrounding immigrants; that combined with the influx of immigrants they hope to gain control of determining and setting their own quotas. To add to that, a series of EU treaties have shifted a growing amount of power from individual member states to the central EU bureaucracy in Brussels. Britain has begun to become highly concerned with the amount of power it holds as compared to the amount of power the EU holds. With those motives, Brexit turns into an initiative power move in hopes of forming a new United Kingdom in Europe.
The European Union functions as the second most regional economic integration as an economic union. Regional economic integration refers to an agreement between countries in a geological region of trade instruments such as reducing tariff and non-tariff barriers to free the flow of goods, services, and factors of production between each other(Pearson, 307). On an economic level, products and factors of production flow freely amongst member states. This level also extends to a common external trade policy, a common currency, a harmonized tax rate along with common fiscal and monetary policies(Pearson,309). With hopes of an agreement, Britain wants to quit the European Union single common market and begin to seek a broad trade agreement while opening its doors to other possible partners. The UK is the world’s fifth biggest market, which made it the EU’s the biggest market(Morphet,14). In 2017, “About 44% of UK exports in goods and services went to other countries in the EU in 2017 — £274 billion out of £616 billion total exports.”(Team) but the remaining £342 billion comes from non-EU states such as the United States, “China, Brazil, Japan and India”(Polgar,89).
How it works
The United States has a “special trade relationship” with the United Kingdom. The UK earns the most through trade with the United States as a single partner. Although the EU accounts for 44% of export trade, it accounts for the 27 member states as a whole, if divided equally each member states accounts for about £10 billion compared to the US’ £100 billion as of 2016(Statistic), ten times more. Unlike a customs union, through a free trade Britain will be able to control and set its own tariffs on countries outside. Setting rules and organization of the international commerce allows for hegemonic powers to settle(Hamill). Along with taking their customers from the EU while leaving the union at the same time, Britain will be able to invest more into strengthening ties with other countries that can help them to continue growing. Growing their trading partners and economy will ensure Britain’s dominance in the international economic world without having to be under the wing of the European Union.