With travel between the UK and the US now open and each country’s economy showing signs of improvement, ZEDRA looks at why there’s never been a better time for the two nations to do business with each other. The UK in 2021 presents a wealth of opportunities to US companies and the signs are they seem poised to take advantage.
Mutual ties that bind the two countries’ corporate and business interests remain strong. These ties are not just related to the boardroom but also include language and culture.
The US and the UK have enjoyed a special relationship with intertwined economic, military and cultural interests for over 80 years and that will continue to deepen in a post-pandemic world. The recent AUKUS security pact is an indication of what we can expect over the coming years.
Transatlantic business ties
Currently, the UK is the largest market for US goods in Europe and, as the US-UK Business Council points out, British companies have invested more than $560bn in the US, which accounts for more than 15% of all inbound foreign direct investment (FDI). Around 42,000 US firms export to the UK and more than 7,500 have operations there, according to the US Chamber of Commerce.
The business relationship goes both ways. The UK is also the largest market for US service providers in the world. Overlapping industries for both countries include aerospace, agricultural products, cyber security, medical equipment, financial, travel and business services.
Not least, US firms have invested nearly $758bn in the British market, that’s a quarter of their total investment in Europe and more than 12% of all US FDI worldwide. The US and the UK have been and will remain important business partners.
Why do US companies choose the UK?
The UK government helps thousands of US businesses expand to the UK through tax breaks, business development and business support initiatives and access to talent and immigration. The government is eager to advertise that the UK has a market of over 67 million people and a highly skilled workforce, including “a pool of talent with top technical training, plus graduates from some of the best universities in the world.”
The UK boasts competitive taxes and its taxation rules are simple to understand.
Financial incentives are also available, with support on offer for research and development and other tax reliefs to encourage investment.
Well established US headquartered companies who might want to expand will appreciate the UK’s straightforward set up processes. Not to mention that the UK serves as a prime location to jump off into the rest of Europe. Many companies use their UK offices as the first step towards larger European expansion, even after Brexit.
Why do UK businesses choose the US?
The US is probably the world’s most exciting and dynamic place to do business; it is, after all, the world’s largest economy, accounting for over a quarter of the world’s total GDP.
The UK-US Business Council helps facilitate business and trade between the UK and the US. It agrees that UK businesses setting up in the US can take advantage of a growing market with a huge demand for British goods and services.
From the laidback West Coast to the frenetic East Coast, UK companies can find a market within the major US cities.
The Special Relationship Continues
The US and the UK have never been stronger partners. While travel into the US was closed for over a year, the distance between the two countries often felt larger than just a hop ‘across the pond’ but with borders and business reopening, that distance is shrinking and the special relationship shared between these two countries is on course to continue.