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Will a Democrat or Trump win this year be best for UK-US exporters and online traders?

Will a Democrat or Trump win this year be best for UK-US exporters and online traders?

Trump has previously slapped new tariffs on British goods, but supports a post-Brexit US-UK free trade agreement. Democrats are less likely to impose new duties but won’t approve any deal that undermines the Good Friday agreement; and want to see major e-commerce platforms broken up. 

ParcelHero says the 2020 Presidential election will have a profound impact on UK exporters and traders - whatever the result.
 
As President Trump rebounds from impeachment, and this week’s New Hampshire Primary shows Bernie Sanders and Pete Buttigieg opening a lead over the other runners to be nominated as the Democrat’s Presidential candidate, the US parcel delivery specialist ParcelHero says this year’s US elections will have a major impact on UK companies selling and shipping to America. It says that, regardless who wins, there will be significant changes for everyone trading and delivering goods to the USA.

Says ParcelHero’s Head of Consumer Research, David Jinks MILT: ‘Whether Trump or the Democrats win later this year, UK traders and exporters will see significant changes; and it’s not clear which outcome would be best for UK companies. In the case of the Democrats the situation is complicated further by the continuing process of choosing their Presidential candidate. Many of the contenders hold very differing views on tariffs and e-commerce. British retailers and exporters, whatever their size, should start planning now for how to deal with the result of the US election.’

Here's ParcelHero’s analysis of the impact of a Republican or a Democrat win: 


 Trump win


Trump is bullish about a post-Brexit free trade agreement with the UK, which could potentially see the end of all tariffs in UK goods going into the US. Such a deal would be a major boost for UK manufacturers and traders. However, fears continue that any agreement will be linked to changing UK food import regulations, and access to the NHS for American companies. Hammering out an agreement could be harder than first supposed. 

A major concern for UK companies is that Trump is very happy to use tariffs on goods entering the US to protect US jobs and interests. It’s not only obvious targets, such as China, who he sanctions with new duties. Last October President Trump slapped a 25% tariff – amounting to £6.1bn  - on a long list of British and EU products entering the US, in a tit-for-tat for what he claimed were illegal subsidies made to Airbus. UK clothes manufacturers, from Saville Row suits to Scottish woollen knitwear, were hit by the tariff; which was also imposed on other traditional British products such as Scotch Whisky. 

Top of Trump’s agenda for his second term would be the privatisation of the United States Postal Service (USPS).  He commissioned a report which claimed: "A privatized Postal Service would have a substantially lower cost structure". He also believes the USPS is significantly undercharging Amazon for its parcel deliveries. Amazon is a company, remember, owned by Jeff Bezos, who also happens to own Trump’s fiercest critic, The Washington Post newspaper. When the current US Postmaster General retires soon her successor will be chosen by the Postal Service Board of Governors, which has a Trump-appointed majority. That clears the way for a pro-privatisation postal boss who would be highly likely to, at the very least, end the delivery of parcels by the USPS. That will likely raise the price of postage to the US for UK sellers still using traditional Post Office services.
 

Democrat win

Democrats are a lot less enthusiastic than Trump about a post-Brexit trade deal with the UK. Remember that the former Democrat President Barack Obama once warned the UK that, if it voted for Brexit, Britain would go to the ‘back of the queue’ on trade deals. Democrats would prefer to negotiate with a united European Union (EU) when reaching trade agreements and are concerned about the impact of Brexit on the Good Friday Agreement. Nancy Pelosi, the Democrat Speaker of the US House of Representatives, says: ‘If Brexit undermines the Good Friday accord, there will be no chance of a US-UK trade agreement passing the Congress.’ 

The Democrat nominees may agree about Brexit, but they are far less united on tariffs and free trade agreements. Most, such as Michael Bloomberg, the wealthy former mayor of New York, support Trump’s new free trade agreement with Canada and Mexico, but some, such as Elizabeth Warren, Bernie Sanders and Amy Klobuchar, are also following Trump’s lead in embracing duties as a negotiating tool. Elizabeth Warren has gone so far as to say tariffs are one part of reworking America’s trade policy overall. But other leading candidates, such as Joe Biden and Pete Buttigieg, say it is US citizens rather than other countries that are feeling the brunt of Trump's trade war tariffs. UK exporters may well be hoping a free trader such as Biden or Buttigieg wins the nomination, to avoid a continuation of recent trade wars.

All leading Democrat candidates oppose the privatisation of the USPS, with Bernie Sanders actually being endorsed for President by the American Postal Workers Union for his opposition to the closure of rural post offices. While that is good news for UK online marketplace traders using traditional mail services to the US, there are concerns that many Democrats want to break up e-commerce giants such as Amazon entirely. Elizabeth Warren is leading the charge against Amazon, Google and Facebook. She believes they are monopolies that ‘squash small businesses and innovation.‘ Bernie Sanders and Tulsi Gabbard are also gunning for these sites; other contenders, such as Amy Klobuchar and Jo Biden are at the least calling for federal regulators to investigate them.

Concludes David: ‘It’s clear that the outcome of this year’s US election will be of huge importance for UK trade, just as we sail into the uncharted waters of Brexit. ParcelHero's constantly updated USA parcel delivery guide will keep shippers up to speed with any changes to US deliveries; and we expect to see some significant adjustments to tariffs and regulations, depending on who wins what is likely to be a tight election.’
You can find out the latest information on US deliveries; including price changes, at https://www.parcelhero.com/en-gb/international-courier-services/usa-parcel-delivery

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