by America was meant to be Britain’s way to the sunny highlands after Brexit. Then, after hopes of a free trade agreement evaporated, successive Conservative governments have lowered their sights, by trying to forge closer ties with individual US states.
Now the civil servants responsible for delivering those deals at state level have been let go, in what one angry British businessman described as “an act of arson”.
More than a sixth of trade posts within British consulates in the US have been axed, with 24 people losing their jobs and other vacancies left unfilled, out of 150 posts. The decision was made barely two weeks before Rishi Sunak called the general election.
Many of the trade teams, based in the nine consulates across the US, worked on trade agreements with Kemi Badenoch, the secretary of business and commerce, flying around America to sign memoranda of understanding with state governors including Florida , Indiana and Oklahoma.
But more importantly, according to British business leaders in the US, the regional trade directors and their staff had years of experience and had made contact with American businesses from Google and Meta to the heads of Hollywood studios.
Jules Ehrhardt, a designer and investor, said there was “shock and disbelief in the British business community” at the decision.
“They are throwing away collective centuries of relational and institutional knowledge that is central to the UK-US trade relationship,” he said. Ehrhardt moved to the US in 2012 to open the American arm of Ustwo, a digital design studio behind award-winning games such as Monument Valleyand worked with Google, Nike and Twitter, before founding venture capital firm, FKTRY.
He said the consulate directors acted “as a liaison” between British and American business leaders, introducing, advising and lending their expertise. “We hit ourselves in both feet undermining Britain’s ‘gateway to Europe’ status for American companies after Brexit, and we were told to back off, and now we’re a self-elected lobby,” Ehrhardt said.
“This [is an] an act of arson in the final stages of this government. We claim it’s a special relationship, but nevertheless we remove the people who are at the heart of the community.”
Allan Rooney, founder of Rooney Law, which has helped more than 300 companies from the UK, Ireland and Australia enter the US market, said the directors were “absolutely critical in building strong and mutually beneficial trading relationships between businesses the UK and the US”.
“The strategic introductions these directors provide is a huge asset,” he said. “They tie companies into a market they know nothing about. They inform them through trade missions and other means of supporting and understanding the market and the subtle differences between the UK and US culture of ‘doing business’. Removing that layer will affect trade relations.
“More than a million Brits are employed by American businesses – I can’t think of a more important trading relationship after Brexit. It is vital. And I think it could be worrying that a very large range of intellectual capital and institutional knowledge would be eliminated. It could put pressure on already under-resourced trade teams.”
Another British business executive based in the US said there was very little stability in UK consulates because they were staffed by Foreign and Commonwealth Office officials who usually stayed in the US for periods of two or three years. “It’s a constant revolving door,” the executive said. “Those are the people we lean on.”
William Bain, head of trade policy at the British Chambers of Commerce, said: “If we want to grow our economy we need to boost trade, so it’s worrying that cuts are being made to staff supporting key export sectors of the US. , our second largest trading partner.
“We need to increase our support for companies that want to enter or increase market share in the United States, not decreases. This is especially true as we hope to reach deals on critical minerals and digital trade with the US federal government in the next year or so.”
Boris Johnson, Liam Fox and other Brexiters hoped that signing a trade deal with the US would provide economic growth for the UK, but Johnson failed to convince Donald Trump and Joe Biden. Last June, Rishi Sunak signed an “Atlantic declaration” with Biden that allowed UK businesses to access some US subsidies.
There has been some recognition of British professional qualifications by State level markets and some regulatory barriers have been overcome.
A UK government spokesman said: “UK trade and investment teams in America are fully focused on promoting UK interests in the US, driving investment and strengthening our trading relationship with our closest ally. We keep our structures under constant review to ensure that they deliver the greatest impact for the UK, ensure the highest quality service for businesses, and at the same time deliver the best value for money for taxpayers.”
