The following answers to questions posed by the California Chamber of Commerce are from Andrew Whittaker, consul general, British Consulate General San Francisco.
United Kingdom-California Relations
Please describe your thoughts on the unique relationship between the United Kingdom and California?
California is a significant piece of the United Kingdom’s special relationship with the United States, both as a strategic partner given the size of our bilateral trade, investment within the state, cultural parallels and mutual overarching interests, such as reducing our carbon footprint, but also as a cultural friend.
Every year, more than 686,000 Brits visit California, spending an average of $905 million within the state. California is the only state where the U.K. maintains two consulates (San Francisco and Los Angeles). It is well-known that we share strong linkages in the tech, engineering, bioscience and entertainment industries.
This past June at the annual Conference of Mayors, Los Angeles Mayor Eric Garcetti spearheaded a resolution to bring the U.K. and the U.S. closer through supporting a comprehensive trade agreement. Currently the U.K. is the second largest foreign investor in California and U.K. subsidiaries employ more than 110,000 Californians. California exports more than $17.8 billion worth of goods and services to the U.K. annually and is the fifth largest export market for the state.
Climate is another area where both the U.K. and California are committed to taking action to slow manmade effects on the environment. The U.K. is hosting COP26 [United Nations Climate Change Conference] in November 2021—of which we know California will be an important partner—where we’ll further discuss this pressing issue: from the pandemic response and economic recovery and how that will join up with sustainability, including green finance, to the transition to zero-emission vehicles, both of which we know are important to California.
Pandemic Impact on United Kingdom
As countries all over the world feel the pandemic, what is the economic impact of COVID-19 on the United Kingdom?
COVID-19 is the biggest threat our country (and most countries) have faced in decades. All over the world we are seeing the devastating impact of this invisible killer, which is why the U.K. government is working to a scientifically led, step-by-step action plan—taking the right measures at the right time.
The U.K. has taken unprecedented action to increase National Health Service capacity by increasing the numbers of beds, key staff and lifesaving equipment on the front line to give people the care they need.
During this difficult time, the U.K. government recognizes the extreme disruption the necessary actions are having on people’s lives, their businesses, their jobs and the nation’s economy.
That is why the U.K. has announced a number of measures supporting public services, workers and businesses to protect against the current economic emergency, including:
• Setting up a £12 billion ($15.2 billion) economic response to support businesses, households and public services—including a £5 billion ($6.58 billion) COVID-19 Response Fund to support the NHS.
• On March 17, the U.K. extended the support available to individuals and businesses, including a business rates holiday, grants to smaller businesses and a package of government-backed and guaranteed loans, which make available above an initial £300 billion ($394.56 billion) of guarantees.
• On March 20, the U.K. government announced a package to help individuals affected by the crisis. This covered a Coronavirus Job Retention Scheme, as well as changes to our welfare system, including Universal Credit and Statutory Sick Pay, making support quicker and easier to access, as well as more generous.
• Then on the March 26, we announced even more support to help the self-employed, with the Self-Employment Income Support Scheme.
U.S.-U.K. Free Trade Agreement
What does the U.S.-U.K. Free Trade Agreement (FTA) currently under negotiation mean for the United Kingdom?
A U.K.-U.S. FTA will provide the opportunity to boost trade, jobs and growth for both economies, and will allow us to help shape the global economy as it recovers. The U.S. and the U.K. are the first and fifth largest economies in the world respectively and maintaining a deep trade and investment relationship is of the utmost importance, particularly as we depart from the European Union. An ambitious trading relationship with one of our closest partners will only deepen our ties.
That said, an FTA will help to improve the resilience of our supply chains through diversity and opening new markets for business, bringing investment, better jobs, higher wages and lower prices, at a time when we need them most. This FTA is an important part of the long-term economic recovery, providing new opportunities for businesses and entrepreneurs in every industry.
We also look at the FTA as an opportunity to set global best practices by future-proofing the agreement to take account of changing technology and developing areas of the economy, such as securing cutting-edge provisions which maximize opportunities for digital trade across all sectors of the economy.
Both of our countries are global leaders in producing “unicorn” companies—private companies worth over $1 billion—in these rapidly developing sectors, and an FTA can create the conditions for the creation of many more. It will also enhance the mutual trading relationship in key areas such as food and drink, advanced manufacturing and services.
