Future of u. S. U. K. Trade relations. This was hosted by the u. S. Chamber of commerce and is one hour. Well, what a behaved crowd. Everyone. Ng i am the executive Vice President of the chamber of commerce. In charge of international affairs. Good to see a full repair. On behalf of the u. S. Chamber of commerce and the u. S. U. K. Business council, we are delighted to host today. Give david davis a round of applause. Applause] i know, secretary davis, this is your first visit back to washington in a couple years. Welcome back. It is an interesting time on both sides of the atlantic. We have a unique set of complex challenges which will not be the subject of todays discussion. I know you are coming off an interesting round of negotiations. We look forward to hearing from you. In todays crowd, i know there are a lot of business leaders. There are also diplomats from different entities in washington. I also want to recognize one diplomat in particular. From the u. K. Embassy. He has done a great job representing his country here in washington. Applause] now, it is an unusual occurrence. Someone said on their way in, you know, it is the first time in 25 years on a friday before labor day. It very muchthat is a reflection on the importance of what is going on in europe and the importance of our guest. So we have a full house the day before labor day weekend. Let me say a few things at the outset. Then i will turn to secretary davis for his comments. As the clock ticks toward the the unitedadline for kingdom to exit the European Union, secretary davis we know an and your team will carry enormous responsibility on behalf of the british people. I know youll be talking today about the about ahead and how you look forward to a more double and flexible and andvative British Society here in the room you have partners in that and ever. But we clearly have a huge stake in the transatlantic relationship. Relationship where and where we 2. 5 billion a day billion. 5 relationshipship. Is a lot deeper. If you think of the history United States and europe ing the democracies ups the heart is the one between the United States and u. K. Say a lot of statistics the lk about the u. K. , largest sing the investor and u. K. Is the he vent largest trading accounts for de 2 american jobs and rms export to the u. K. And they have operations in the u. K. Underscores a partial this relation shape. Em, embargo on this journ its important that the United States unity and our government work handinhand with you to some or your endeavors, your goals and your aspirations as we clearly have a stake in the outcome of these discussions. Which is why the chamber founded the u. S. U. K. Council, one of 15 we now run, to work not only to strengthen the relationship between u. K. In the u. S. , but also to look at the work of the brexit areas. We have three simple objectives. I willd begin by saying say more on this topic later. Is we are glad mr. Rooney one that has been selected to be chair of this council. Of course, we want to encourage you to have predictable transition periods that ensures a strong future partnership going forward. Second, we want clarity on the way forward, when you can, in terms of minimizing business and incurs both sides to understand the consequences of failure to do so. A good deal. T u. K. En the and e. U. D there are strong critics between unrelateic aplompse and response to er that which is to get to work and and the u. K. Are able to move forward. To know that we are eeg are to be hearing from you helpful in our work. And datath the workers nd here to hear more about intellectual Property Rights and and t access for goods Financial Services and issues, i on your agenda. A paper on these issues which we will share with secretary davis and your team. The negotiations will be tough will have their ups and downs. Similarities what the United States faces. The Trump Administration has een i think in some ways important and also relevant to your discussion. Stakes are high but your commitment to you and your we are nt is that supportive of the special let me turn to an introduction of secretary davis. He was appointed secretary of state for exhibiting exiting the European Union. Had held an array of government position including science minister and shadow home secretary. Before being elected, he worked in the food industry. If you look at the totality of his background, he is a good person to make sure the u. K. Interests are well guarded in this negotiation. In his time in the reserves, secretary devos had a few broken noses secretary dvis had a few broken noses on occasion. Secretary davis, welcome to a committee very supportive of the u. S. U. K. Relation. Thank you for this generous comments. Good morning to you all. Its a pleasure to be here. I am a longstanding fan of the United States. You are the only country to be successfully founded on an idea, the idea of freedom and democracy put together. It is such a privilege to be here. The last time i was in the they the last time i gave a major speech in the states was in texas. Now of course facing a devastating natural disaster. The people in the United States and the United Kingdom are one in the same. We have stood sidebyside through tough times, through world wars, through terrorism, through natural disasters. As always, britain has remained a friend. Our thoughts and prayers are with the American People and all those suffering during the current tragedy. I have just flown in from brussels where we have been busy with each other negotiation over our departure from the European Union. Our goal is to achieve a successful future partnership with the European Union. One that delivers a seamless and frictionless trade as much as possible. I said to my european counterpart, the optimist sees opportunity in every difficulty. I am a determined optimist in this. Fundamentally, i believe that a good deal is in both the interest of the 19 and the European Union and the in of the United Kingdom and the European Union. Many want clarity over our approach. You, the businesspeople, you dont start a negotiation knowing the exact conclusion. On areas as diverse as customs, data, all those things, we have begun to navigate our way towards the and i am confident torwards them. I want to step away from the details for a moment and look beyond the next few years. The u. K. Will be outside the European Union. We can tackle the greatest social and economic challenges we face in this era of globalization. The answer for these questions is to not become isolationist. The economic problems of the west cannot be to turn our back on globalization. Instantly the world for once again. It is to lead the world forward once again. We must develop our economies in areas where we have a disadvantage. This is the great prize we can win from brexit. We can strike new trade agreements across the globe, including with the European Union. In britain which is temperate and logical. We are the worlds fifth largest economy. Achieving this will not be easy. We need global businesses to help us achieve our global goals. Many of you sitting in this room. What invention has helped saved the lives of billions of people. I usually get the answer antibiotics or medical technology, the real answer is freetrade and capitalism. Freetrade has delivered an unrivaled increase in prosperity across the globe. It has raised more people out of poverty been any or all of government initiatives put together. Now the world is undergoing an extraordinary period of economic change. New technology is producing new forms of production and disrupting others. It is necessary to make the case for free trade and capitalism. For me here in the United States is the logical place to make that case. The United States is the crucible of the modern will and will is and globalization. Free trade helps spread that Technology Beyond europe. Its a written from being a large and largely Rural Economy at the end of the 18th century to a largely industrial one at the end of the 19th century. In this country, the era of carnegie and j. P. Morgan. Trade across the globe allowed of two focus on the food that were the most successful court manufacture for manufacture. Today under 1 percent of people work in agriculture. It changed the social makeup of our countries. It led to a society that is unequivocally better off. We as seen a shift in production, of manufactured goods from west to east. In 1990, less than 3 of the World Manufacturing was made in china. Now it is just under 25 . This new era of change may feel like a threat and there are good reasons to believe globalization is not working for everyone. Sluggish productivity growth has left wages falling for many in the u. K. And the u. S. The u. K. And the u. S. Has for a long time spent more than we saved, meaning we have to borrow from abroad to cover the shortfall. The response of the International Community has been to reduce rather than intensify cooperation and trade. Last year the wto, reported a rise in protectionism. We have seen examples of countries failing to play by the rules, intern providing risk for global systems. In turn providing risk for global systems. The urgent need to remove excess capacity has not been done. The 1930s showed us the danger of protectionism. It damages global trade. Barriers inhibit global and domestic growth. It is through freetrade that we can deliver stable growth to our economy. The only Sustainable Way to deliver Better Public Services is by boosting productivity. This means more trade, not less. For britain, it means maintaining our strong trade links with european markets and seeking out new opportunities for trade and investment with a new and old friends alike. That is why our trade secretary with here in july. To launch the u. S. U. K. Trade working group. At home, britain will remain open to the town, ideas open to the talent and ideas, we will create an economy that works for all. We will open markets an strengthen the open trade system. Part of that will be the liberation of the service sector. Doing so gives us the potential to revitalize productivity and growth. We must Work Together to convince other countries of the benefits. The wto has an Important Role to play in finding solutions that help share the benefits of globalization. At the same time, delivering a Global Economy that works better for all citizens. Once we are outside the European Union, we will push harder by spearheading the movement to open up trade and boost productivity. Opening Service Markets also brings another benefit. As the governor of the bank of england said, liberalization of services is one of the reasons for our trade deficit with the rest of the world. History has taught us that large, access to trade imbalances can be damaging for the entire Global Economy. These imbalances or a contributor to the financial crisis of 2007. Surplus countries save vast amounts of money and this surplus came to the west. It allows people to buy things they cannot afford. These excess balances still exist. I want to visit commitment to create a International Corporation to be met by International Cooperation on standards. We cannot outcompete emerging economies with cheap labor. There is no future in trying to be cheaper than china or other emerging economies who had enormous lowwage cost advantages. We cannot do very much to regulate this advantage with less regulation. After we leave the European Union, we will not be engaging in a regulatory rate to the bottom. A regulatory race to the bottom. An independent britain after brexit gives us a chance to race to the top for quality and standards across the globe. Focusing on highquality, high innovation, where the developed world can compete. You and we can compete to the benefits of workers. They can build trust between Different Companies in different countries. They can help develop better products. The automobile industry, an industry where the safety of the consumer is paramount. The European Union has developed a standard for all new cars being registered in north america, europe and many other countries globally. Standards to protect the environment. The you in International CivilAviation Organization was to agree on regulations on aviation. In 2020, there will be a new Global Benchmark for aerospace technology. They can help drive innovation, promote the upside of new technology and energy. They can benefit our technology. They can help spread the new technology such as autonomous vehicles, electric cars and smart technologies. We are going to have to create a whole new level of standard where both our economies dominate. If we are going to try to prevent people from creating their own standard of barrier. The u. K. Has an outstanding record for promoting standards internationally. Driving up standards around the globe, helping out workers and companies to compete in the new economy and help us to build a country ready to compete in the modern world. A bold vision of International Cooperation where countries like the u. S. And the u. K. Provide leadership. Britain cooperating with our friends and allies to drop of standards around the world. To drive up standards around the world. Britain is liberal and international. Thank you very much. [applause] i will take questions and please do not restrict yourself to brexit. As far as i can, you know you cannot walk around telling what you are going to do. Two questions, i could not agree more with you on the importance of services in the Global Economy. Have you had any success with talking to this administration when do you think the foundation will be laid in your relations with the eu so we can think about the timing of serious negotiations on that . Is working hard on the need to get the services as they should. Theoretically, we share a common language, it should be easy. He has been working on it. It is a natural and politic in politics to ignore the obvious. We are working on that. On the u. S. U. K. , i suspect at the end of the day, the limiting factor will be when we conclude. We are bound by a piece of european law called a duty of sincere cooperation. Which means what we do cannot undermine anything European Union is doing. Technically we are restricted in the extent that we can negotiate. That restriction reduces the influence. One aspect here, which is what happens if we end up with a transition phase, we would not have a implementation of force because that would be building a big loophole in the european external tariff barrier. That is not out of line with what would be the timetable anyway. Between us we are big complex economies. You would expect the deal we do to be quite long. Over there, sit . Sir . Thank you, thank you for your great presentation. Two questions related to current european politics. You served a government that was not felt to be able to form a new government. How long will the current government last and are you certain Prime Minister may will be able to write the final chapter in brexit . Another great lady of europe will be in the news soon, chancellor merkel is heading for a big election in germany. How will her reelection presumably enhance the brexit negotiations . John gizzy, chief Political Correspondent with newsmax. My expectation is the government will last the five years, we have changed our structures. Used to the the Prime Minister would call the election whenever they would like. In terms of the brexit negotiation, your profession has great fun on the politics of brexit. The real issue on brexit is practical, what kind of deal do we need . That is the driver and it is the same driver in the parliamentary arithmetic. It will get done in time. For mrs. Merkel, we are very careful, government ministers, on commenting on other politics while abroad. The primary effects of the german election on the Brexit Process is timing. It is going to happen in september but normally after a german election it takes 13 months to form a new coalition. It is a new government. Within the politics of europe, germany is important. Is the Biggest Country in economic terms, and population terms, it is hard to overestimate the influence. The outcome of the german election, im not going to get what it will be. I am not going to guess publicly what it is going to be. The effect of the german election will be to accelerate the process once it happens. Thank you for being here and for your noteworthy remarks on trade. Thank you for your leadership on this issue. We agree that trade equals better lives for more people. The mechanics of trade, hundreds of millions of containers go between the channel carrying goods, fresh fruit, produce, fastmoving consumer goods, the sanitary standards would change, which would create additional cost, not just for the countries in this room and the u. K. And the eu but mom and dad i