Matt Haycox Daily Logo

EU talks are stuck, but a Canada/UK trade deal may be next on the cards

Trudeau thinks a deal is possible before year-end

As the UK barrels towards ending the transition period with no trade deal with the European Union, and while trade negotiations are stalled until after the US election next week — it looks like negotiations with Canada should be a breeze.

According to Canadian Prime Minister Justin Trudeau, negotiations between London and Ottawa will not be hit with the same complexities as the EU-UK talks.

Trudeau said he was “very optimistic” that a roll-over agreement, based on the trade pact it arranged with the EU, could be completed with Britain before the end of the year.

A view of Toronto

Trudeau made the comments from Ottawa following an EU-Canada video conference with presidents Ursula von der Leyen and Charles Michel.

The statement seemed to overturn prior claims that Canada would only extend its EU trade deal to the UK if the UK and EU made their own trade deal first.

But according to Trudeau work is currently in progress to ensure an agreement between Canada and the UK is in place soon.

“Canada is extremely pleased to be the only G7 country that has a free-trade deal with every other G7 country and we would certainly like to keep that,” Trudeau said.

“There have been many discussions over the past years between myself and Prime Minister Johnson and his predecessor on that seamless transition on a rollover of the CETA between Canada and the European Union to be the basis for a Canada-UK free-trade that would allow certainty for Canadian and British companies going into the future,” Trudeau said.

Justin Trudeau
Canadian prime minister Justin Trudeau (Image: EbS)

“I think you’ve heard that there are significant complexities that the UK is grappling with in terms of negotiating the post-Brexit agreement with the European Union. I can highlight that it’s fairly straightforward with Canada and we are certainly very optimistic in the ability to see things roll over smoothly.

“The UK is engaged in many different negotiations right now, but Canada is certainly there to ensure this certainty that can be given to British companies, at least with Canada, as other things are worked out in a more complex way.”

The UK-Canada free-trade agreement will eliminate tariffs and quotas on most products.

The UK has already secured its first major post-Brexit trade deal with Japan. But a deal with Canada would assure that the country was moving in the right direction, even without an EU or US trade deal yet.

Meanwhile, its still not impossible for the UK to finalise a trade deal with the EU before the December 31 deadline.

According to European Commission President von der Leyen the two sides are making “good progress” despite the main hurdles sof future common standards and access to Britain’s fishing waters.

“We are in a critical phase now, and it’s boiling down indeed to the two topics that are the most important,” von der Leyen said.

“It is the level playing field on one side and the fisheries on the other side, but I want to remind that there are 11 other fields of files that have to be negotiated till the very end.

“We’re making good progress but two critical issues level playing field, and the fisheries, there we would like to see more progress.”

OTHER TRADE DEALS

Meanwhile, though all the focus seems to be on the UK’s trade deal negotiations with the EU, and on the likelihood of a US deal, the country does already have several trade deals in place, the largest one being Japan.

A view of Osaka, Japan

The UK-Japan Comprehensive Economic Partnership Agreement was signed by International Trade Secretary Liz Truss and Japan’s Foreign Minister Motegi Toshimitsu in Tokyo on October 23.

The agreement means 99 percent of UK exports to Japan will be free of tariffs.

The deal is said to be similar to the 2018 free trade deal the EU signed with Japan back in 2018, but is more tailored to both economies with big benefits for digital and data, financial services, food and drink, and creative industries. 

International Trade Secretary Liz Truss and Japan’s Foreign Minister Motegi Toshimitsu in Tokyo

The estimated boost to trade between the UK and Japan is more than £15 billion. The total value of UK-Japan (imports and exports) was £29.1 billion in 2018, according to the Department for International Trade. Trade with Japan accounts for just two per cent of the UK’s total.

But there are several agreements with other countries and trading blocs that should take effect when existing EU trade agreements no longer apply to the UK, from 1 January 2021.

A trade agreement is in place with Switzerland

Those countries or blocs include: two Andean countries, the Cariforum trade bloc (Caribbean countries including Jamaica, the Dominican Republic and Trinidad), Central American countries, Chile, Côte d’Ivoire, the Eastern and Southern Africa trade bloc (ESA), the Faroe Islands, Georgia, Iceland and Norway, Israel, Kosovo, Lebanon, Liechtenstein, Morocco, some Pacific States, Palestine, South Korea, the Southern Africa Customs Union and Mozambique trade bloc (SACUM, Switzerland, Tunisia and Ukraine.

From that group Switzerland is the country that has the largest trade with the UK — worth some £38.5 billion in 2019.

Share this post

Share on facebook
Share on twitter
Share on linkedin
Share on print
Share on email