WASHINGTON – U.K. Treasury chief Philip Hammond said Friday he is confident the U.K. and the U.S. can strike a free-trade accord once Britain has left the European Union, saying a wide-ranging deal would benefit both economies.
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Speaking to reporters on the sidelines of the spring meetings of the International Monetary Fund and the World Bank in Washington, Mr. Hammond said there is "very strong political momentum" in both the U.S. and U.K. to reach an agreement on boosting trade.
U.S. President Donald Trump has made bilateral trade ties a cornerstone of his administration's economic policy, while the U.K. has made forging stronger links with countries outside the EU a key part of its post-Brexit strategy.
"There is clearly a very strong political momentum behind this deal," Mr. Hammond said.
As an EU member, the U.K. can't currently ink trade deals on its own, but Mr. Hammond said London is eager to start talks as soon as possible.
"As soon as we are able to, as soon as it's possible in terms of our obligations to the European Union, we will begin preliminary discussions with the United States" on a trade accord, Mr. Hammond said, adding Britain would aim for a "comprehensive" agreement covering both goods and services.
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Mr. Hammond's U.S. visit comes two days after U.K. Prime Minister Theresa May won the U.K. Parliament's backing to hold a national election in Britain on June 8.
Mr. Hammond said calling a snap poll was "the right thing to do" as it will strengthen the U.K.'s hand in coming exit talks with Brussels.
Before Mrs. May called for a fresh poll, the next election had been scheduled for 2020 -- just months after divorce negotiations are due to wrap up. The U.K. formally notified Brussels of its intention to withdraw from the EU at the end of March, starting the clock on two years of exit talks.
"We were going to be coming to a crescendo in negotiations against the backdrop of the run-up to the next general election in 2020.
"Our European Union negotiating partners were acutely aware of the leverage that that gave them, and removing that leverage has undoubtedly strengthened our negotiating hand," Mr. Hammond said.
He said that the ruling Conservatives' election manifesto would continue to put emphasis on reducing Britain's budget deficit, but hinted he may seek more flexibility in meeting current deficit-reduction goals, saying existing commitments from the party's 2015 election manifesto are too restrictive.
Those call for budget gap, currently around 3% of annual national income, to be eliminated during a five-year parliamentary term, while limiting the treasury's ability to raise some taxes and cut spending on areas such as health care.
"The commitments that were made in the 2015 manifesto do constrain the ability of the government to manage the economy flexibly," he said.
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(END) Dow Jones Newswires
April 21, 2017 11:13 ET (15:13 GMT)