The UK could lose free trade deals with countries such as Canada, Japan and South Korea after Brexit, a Government minister admitted today.
Greg Hands, a junior minister in the Department for International Trade, confirmed today there “isn’t a guarantee” the EU’s agreements with more than 65 countries can be copied over to the UK after March 2019.
Earlier this month, International Trade Secretary Liam Fox revealed that while his department had been in discussions with many of the countries who have a free trade deal with the EU, nothing has yet been formally agreed.
His team’s chief negotiator also admitted that even if some countries agree in principle to roll over the deals, “what people say today sometimes changes tomorrow.”
At a pro-Brexit conference in Westminster this morning, Hands was asked by HuffPost UK if he was worried the UK would lose those deals.
He replied: “No I’m not because all of the major ones have agreed to do this. None of those partners has yet said they won’t do it.
“Of course, there are 40-plus of these agreements, some of which are much more useful than others, so of course there isn’t a guarantee we’re going to get all 40-plus of these agreements transitioned but I am very confident and Crawford is very confident that we will be in a very, very good space to ensure these become UK FTAs [Free Trade Agreements].
“It’s strongly in the common interest; the European Commission knows we are doing this.”
The EU currently has active trade agreements with 65 countries. If the UK does not get these to agree to carry over its deal it has with the EU, World Trade Organisation (WTO) tariffs will be applied on goods.
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A free trade deal with Canada is currently being ratified by EU member states, while an agreement with Japan – the world’s third largest economy – has been agreed in principle.
Angus MacNeil, the SNP MP who chairs parliament’s International Trade Select Committee told HuffPost UK: “The reality is that this government is living day to day in a stupor of self-delusion.
“They are playing for time, the sooner companies realise this the better, otherwise the price they will pay is a very high in attrition rate for being misled by politicians with no leadership and no responsibility who care little, but we will all pay dearly.”
James McGrory, Executive Director of anti-Brexit group Open Britain, said: “EU membership has been vital in securing trade deals for Britain with big economies like Canada and South Korea, boosting businesses and supporting jobs.
“And now a Government Minister has admitted that there is no guarantee these deals will remain in place after Brexit. We are facing a truly destructive cliff edge as a result of the Government’s policies – damaging our trade with the EU by leaving the Customs Union, and losing deals with the likes of Canada at the same time.
“The Government’s Brexit policy will mean less trade deals, not more. The best way to preserve our trade, both with Europe and with countries further afield, is to stay in the Customs Union.”
Speaking at the same event as Hands, former Brexit Minister David Jones said the UK should walk away from the negotiations with the EU and begin preparing for life on WTO rules with Britain’s largest trading partner.
Such a relationship would see tariffs of 33% on dairy products, 10% on fruit and vegetables and 20% on sugar and sweets.
Jones believes that if the EU does not agree to begin talks on the final trade deal after a crunch Brussels summit in December, the UK should tell say: “We are not going to waste our and your time on negotiations that are clearly quite fruitless and which are being used by you quite disreputably in order to string out the process and put pressure on the United Kingdom.”
He added that trading on WTO rules is “quite exciting”.