And experts are now predicting that the UK economy is expected to return to pre-Covid levels by the end of 2021, a year earlier than expected. Britain has been caught in a tit for tat battle between the US and the EU over aerospace subsidies, which has resulted in massive border fees being imposed on some exports. The Scotch whiskey industry is estimated to have lost over Â£ 600million in exports after being hit by 25% levies on each bottle.
Ms Truss and her US counterpart Katherine Tai have agreed to lift retaliatory tariffs for five years after talks in London.
The International Trade Secretary said: “This deal will support jobs across the country and is great news for major employers like Scotch whiskey and sectors like aerospace.”
She said this “draws a line under an incredibly damaging problem” and means the government can focus on “taking our trade relationship with the United States to the next level.”
Ms. Tai said that reaching an agreement was “a big step forward for our special relationship.”
The conflict raged for 17 years, but escalated in recent years after the World Trade Organization discovered that both sides had broken subsidy rules.
Washington hit the EU with tariffs on goods worth Â£ 5.6 billion in retaliation for state support for Airbus.
Brussels responded with tariffs on Â£ 3 billion worth of US goods in addition to subsidies given to Boeing.
The tariff lifting deal also benefits pig farmers, stilton makers and cashmere producers.
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The revival in trade comes as economists predict the UK economy will rebound by the end of the year.
Growth is expected to reach 8.2% this year and 6.1% in 2022, and peak unemployment will be lower than previously forecast.
The rapid rollout of vaccines and the “rampage” of pent-up demand means the recovery is a year ahead of its previous forecast.
Despite the delays until the lockdown is over, the economy is still poised for “considerable” growth in the coming months.
Household spending is expected to increase 3.6% this year and 7% in 2022.
The extension of the holiday until the fall and expectations of a stronger economic recovery will lead to a lower spike in unemployment, according to the report.
Real household incomes will rebound in 2022, increasing by 3.1%.
But business investment will remain five percent below levels seen before the pandemic.
Recruitment difficulties causing bottlenecks in global supply that “fuel pressure on prices,” the report warns.
The aviation and event industries are also expected to take significantly longer to recoup their losses than the rest of the economy.
CBI Managing Director Tony Danker said there were “really positive signs” for the economic recovery to come.
âThe data clearly indicates that there is pent-up demand and ambition in many sectors.
âThe imperative now must be to seize the opportunity to channel this investment into the major engines of the UK’s long-term prosperity.
âThis is why this is a good time for the government to come up with much more detailed plans on everything from decarbonization to innovation to upgrading.
âThis clearly does not apply to the sectors hardest hit by the pandemic which, even now, face continued delays and real challenges to remain viable.
“It would be devastating for the hospitality industry, events or aviation businesses to fail on what we hope will be the last leg of the restrictions.”
Liz Truss, Secretary of International Trade, comments:
As a newly independent trading nation, we leave behind the damaging trade disputes of the past and move forward with like-minded allies to one.
Our historic deal with the United States does just that.
It became the longest-running dispute in World Trade Organization history, with other industries like Scotch whiskey being unfairly embroiled in retaliatory tariffs.
We have agreed with the United States to turn the page on this 17-year dispute by suspending tariffs for five years.
Whiskey was our biggest food and drink export last year, and the United States is its most valuable market. Securing tariff-free trade means a boost for the industry and the 50,000 jobs it supports across the UK.
We have not only delivered for Scotch whiskey distillers, but also for cashmere producers and pig farmers.
Ending this senseless dispute will help us take our trade relationship with the United States to even greater heights.
Together, we will fight the unfair practices of countries like China, bring home the benefits of free and fair trade, and build better after the pandemic.