UK Prime Minister Rishi Sunak will arrive in Washington on Wednesday pledging to build an “economic alliance” with the US to counter global threats, while trying to paper over trade tensions between the two sides.
Downing Street admitted before the visit that Britain had given up on seeking a free trade deal with the US — an agreement once seen by Sunak and fellow Eurosceptic Conservative MPs as one of the biggest economic prizes of leaving the EU.
Meanwhile, Sunak will try to secure concessions from US President Joe Biden to soften what UK ministers have called “protectionist” efforts by Washington to build up a domestic industrial base in green technologies.
In a world dominated by the US, China and the EU, Sunak will attempt in his two-day visit to ensure Britain’s voice is heard in debates about “de-risking” the west’s economic relationship with China and regulating artificial intelligence.
Sunak will draw on the close military relationship between the UK and the US — strengthened during the war in Ukraine — and claim that the two sides can work equally closely together on building economic security.
“The UK and US have always worked in lockstep to protect our people and uphold our way of life,” said Sunak. “As the challenges and threats we face change, we need to build an alliance that also protects our economies.”
UK trade secretary Kemi Badenoch is among those British ministers who have warned that Biden’s $369bn green subsidies package — the Inflation Reduction Act — is “protectionist” and would lead to onshoring of industry to the US at the expense of allies.
Sunak’s spokesman said the UK prime minister and Biden would seek to address this problem by providing “meaningful solutions that support our supply chains”.
British officials said talks between the two leaders would consider critical minerals used in battery production for electric vehicles.
Britain is expected to be offered the kind of deal already promised by Biden to Japan in March: allowing US “clean vehicle tax credits” to be extended to critical minerals extracted or processed in third countries with whom Washington has an agreement.
Electric vehicle buyers in the US can receive a $7,500 federally funded discount on their car if it is made in the US and contains enough “local content”, such as the battery.
The rules made under the IRA have sparked a flurry of investments in the US from battery manufacturers.
Allowing the UK to benefit from the rules could mean battery materials, such as lithium that is extracted or processed in Britain, count as local content in US-built vehicles. Such a move could be a potential boon to the UK’s fledgling electric vehicle supply chain.
Sunak wants Britain to be part of a network of western allies building up supply chains that remove dependence on states such as China or Russia. “This is an area where we can find common ground,” said Sunak’s spokesman.
The prime minister is also hoping Britain can be a “nimble” regulator of AI, positioning itself as having a lighter-touch regime than the EU and therefore making it more attractive to US companies and a potential exemplar for a global approach.
But Sunak finds himself trying to insert himself into a discussion already being held at a preliminary level by the US and the EU, which have set up a trade and technology council to discuss such issues.
Antony Blinken, US secretary of state, said at a meeting with the EU in Sweden last week: “I think we share a conviction that the [trade and technology council] has an important role to play in helping establish voluntary codes of conduct that would be open to all like-minded countries.”
British officials have floated the idea of the UK becoming the home for an international AI regulator and acting as the host of a summit to discuss the issue later this year.
Sunak’s meeting with Biden at the White House will be their fourth encounter in four months and talks will also focus on the need to support Ukraine, including through air defence systems.
The UK prime minister will also meet congressional leaders on Wednesday and hold a meeting with chief executives of major US companies on Thursday.