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On 13 March, the UK formalised a trade agreement with Texas to enhance trade and investment connections with Texas, marked by the visit of Texas Governor Greg Abbott to London, as celebrated by Business and Trade Secretary Kemi Badenoch.
With its economy standing as the second-largest among US states, Texas boasted a Gross Domestic Product (GDP) of £1.9 trillion in 2022, surpassing the economies of Italy and Canada. This positions the agreement as the most economically consequential trade agreement the UK has established with a US state thus far.
The agreement is designed to simplify, expedite, and reduce the costs of business engagements between UK and Texas companies by addressing trade barriers, fostering investment, and encouraging trade between the two regions.
The UK ranks as the eighth-largest international market for Texan goods exports, with trade in goods valued at £14.7 billion in 2023. Notable exports to Texas encompass nuclear equipment, aircraft, and pharmaceuticals.
This arrangement targets sectors where the UK and Texas share expertise, including innovative energy solutions like hydrogen and carbon capture, utilisation, and storage, life sciences, and professional business services.
This agreement follows the UK-Florida Memorandum of Understanding (MoU) signed four months earlier, increasing the total number of agreements with US states to eight. These agreements represent a combined GDP of £5.3 trillion, surpassing Japan’s GDP and equating to a quarter of the entire US economy.
Business and Trade Secretary Kemi Badenoch said, “I’m delighted to welcome Governor Abbott to the UK for this landmark signing. Today’s signature with Texas marks the UK’s eighth US state-level pact, meaning UK firms now have access to states with a combined GDP of £5.3 trillion – equivalent to a quarter of the whole US economy. This shows our US state-level strategy is working and really delivering for British businesses.
Prioritising cooperation on innovative energy solutions such as hydrogen will help the UK to go further in achieving its aim to unlock more than 12,000 jobs and up to £11 billion of investment by 2030 in the hydrogen sector. The UK Government’s landmark ‘BioBridge’ collaboration with the Texas Medical Center, the world’s largest medical complex, has already supported more than 30 innovative UK life sciences companies to grow their businesses in Texas – this SMC will help deepen economic ties in this critical sector even further.”
Texas Governor Greg Abbott said, “As our ninth largest trade partner, the United Kingdom plays a critical role in the Texas economic juggernaut. Strengthening the bond between Texas and the United Kingdom is crucial for our shared economies to prosper. By signing this Statement of Mutual Cooperation today, we will further promote economic growth on both sides of the Atlantic.
Texas is the economic engine of America, where entrepreneurs from around the globe can cast a vision and know they can achieve it. Working with our British partners, we will chart a greater path towards success and opportunity and create an even more robust economic partnership.”
Paxman Coolers Chief Executive Officer Richard Paxman said, “We are thrilled to hear that the UK and Texas have signed a SMC to enhance trade and economic development ties. We have been working in Texas since 2013, setting up our US HQ in Houston in the heart of the Texas Medical Center. This dynamic state is one of our largest US markets, representing 20% of our $10m business.”
Concrete Canvas Director William Crawford said, “As a UK business with our US Headquarters in Houston, we are delighted with the news that the UK-Texas SMC has been signed. This will help to strengthen ties with this key US state and help Concrete Canvas achieve our ambitions for further growth and investment across the US.”
UK enterprises are already capitalising on the close trading relations with the US, evidenced by existing MoUs. For instance, Inovus Medical, a leader in surgical training technologies based in Merseyside, established its US headquarters in Tampa Bay in December 2023, a month following the UK-Florida MoU signing.
Opting for Florida as its US base due to its strong healthcare ecosystem and burgeoning innovation and technology sector, Innovus Medical has experienced significant growth in the US market.
