WHILE President Trump continues to dispute the outcome of the US election, millions of people around the world are rejoicing the imminent end of a dysfunctional era at the White House. And that is likely to include many company owners in Scotland who do business with America.
The US is the biggest overseas market for Scottish companies, accounting for around £5.5 billion of exports. And it is a relationship that works both ways, too, with Scotland currently home to around 600 US-owned companies, between them employing around 90,000 people.
There can be little doubt, though, that these connections have been harder to maintain during the Trump years, which, among other things, has seen the outgoing president remove the US from the Paris Agreement on climate change, adopt a protectionist stance in global trade, and threaten to quit the World Health Organization – at the height of the coronavirus pandemic.
More pertinently for Scottish companies, it has been a lot more challenging to secure visas to travel to the US because of Trump’s immigration policies of the last four years.
At the very least, then, it is hoped ways of doing business should revert to something approaching normality when Joe Biden comes to power.
“Incoming president Biden is more likely to want to engage in multi-lateral discussions and behave in a way that Scotland and the UK are more used to US presidents behaving,” said Allan Hogarth of the Scottish North American Business Council, which helps Scottish firms forge transatlantic partnerships.
“We hope the incoming administration will have a more business-friendly approach in terms of visas and migration.”
Biden’s commitment to tackling climate change may be seen a “big plus point” for Scotland, Mr Hogarth said, given the Scottish and UK Government’s net zero ambitions, and the fact the COP26 conference will take place in Glasgow next year.
The US election result also raises hopes that import tariffs applied by the Trump administration to key Scottish exports can be ended. For more than a year now, single malt whisky distillers and producers of other Scottish goods such as cashmere and cheese have been seriously hampered by a 25 per cent import tariff introduced by Washington as part of a continuing dispute between the US and EU over aircraft subsidies. It is estimated the tax has already cost the whisky industry £400 million in lost export sales.
Given that Biden is known as a pragmatist with a reputation as a deal maker, there will be hope of a change in direction, especially amid suggestions the new president will be eager to rebuild relationships with international allies.
There may be extra impetus, too, from the UK Government in attempts to secure a Brexit deal with the EU, which business has been crying out for.
It has been widely reported that Biden will only be willing to pursue a free trade deal between the US and the UK if there is a Brexit agreement. In September the president-elect, who is proud of his Irish ancestry, voiced his concern that the Good Friday Agreement could be threatened if the UK over-rides key commitments to the Withdrawal Agreement which are designed to prevent the return of a hard border on the island of Ireland.
The importance of a Brexit deal is not necessarily the holy grail for Scottish exporters to the US, though. Mr Hogarth said a US-UK deal “should be easier to negotiate once a Brexit agreement is agreed, but Scottish-US trade links are well established”. He added: “Whilst a trade agreement would make things more straightforward, we have managed to be successful thus far without one.”
Notwithstanding the broader macroeconomic challenges, Scottish firms continue to have a lot to aim for. Mr Hogarth, whose organisation has run, or is scheduled to host, virtual trade missions to Philadelphia, the Pacific North West, Nova Scotia and Chicago, said: “The reality for many Scottish companies is that the US states themselves should be treated as individual nations. For example, the population of Washington state is 7.6 million, the population of Oregon state is four million. So, for a nation of our size, it is more realistic to think about how we can sell our products into individual states, [rather] than individual cities.”
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