Philip Hammond warns speedy US trade deal after Brexit is doubtful
Philip Hammond has poured cold water on the idea of a speedy post-Brexit US-UK trade deal, warning that US president Donald Trump will make demands that could prove highly unpopular in Britain.
The chancellor, who confirmed his departure from the Treasury next week no matter who wins the Conservative leadership contest, said on Monday it was unrealistic to think that a trade deal could be completed within a year.
His comments came after an ally of Boris Johnson, the frontrunner in the race, told The Times that a limited trade deal in “one area” of goods could be agreed with the US as soon as October 31, Britain’s scheduled departure date from the EU.
The idea of a speedy transatlantic trade deal drew scorn across Whitehall and Mr Johnson’s team tried to distance the former foreign secretary from such an ambitious timescale.
Mr Hammond, speaking on a visit to New York, told CNBC: “There’s going to be big questions about how we manage access to farm produce, how we deal with different food hygiene standards that we have, different farming practices.
“When you come to issues around animal welfare, there are very deeply held views in the UK. So I think it can be done. We should be ambitious, but I think we’ve got to be realistic that it’s not something we’re going to do in five minutes.”
Mr Hammond also repeated his warning that when he returns to the backbenches next week he will do everything he can to stop the new prime minister taking Britain out of the EU without a deal.
“The new government, the new prime minister will have a majority of two or three in parliament and I’ll be one of them,” he said. “So a lot of power rests in parliament going forward.
“If the new government tries to drive the UK over a cliff edge called ‘no-deal’ Brexit then I will do everything I can to stop that happening.”
Mr Hammond is already working with other senior ministers, including David Lidington, the de facto deputy prime minister; Greg Clark, the business secretary; and David Gauke, the justice secretary, to co-ordinate opposition to a no-deal exit.
Allies of Theresa May have also indicated that she will join around 30 Tory MPs determined to stop a disorderly Brexit. She steps down as prime minister on July 24.
“She hasn’t seen her premiership founder on the rocks because she opposed a no-deal Brexit just to let someone else do it,” said one ally.
Meanwhile Mr Hammond said that while big US banks in London had adjusted their business models to prepare for Brexit, there was a medium- to longer-term risk of more business moving to New York or rival European financial centres if access to the European market was limited.