A Trade Minister has let slip the Government would be unable to cope if countries with EU trade deals wanted to renegotiate them with the UK before Brexit.
International Trade Minister Greg Hands admitted to MPs that if all those countries which currently have an agreement with the EU wished to reopen talks to get a better deal, the UK would struggle to carry out negotiations.
The Government is under pressure to lock-down trade deals with more than 65 countries which the UK is set to lose after Brexit.
But appearing before the International Trade Select Committee today, Hands effectively admitted the Government is a hostage to fortune as if those countries wished to reopen negotiations, his department wouldn’t be able to cope.
He said: “What we want to do is secure continuity in those trading relations.
“For the reasons I outlined, renegotiating one of those agreements may not be possible, there’s also reasons of continuity, there’s also reasons of resources in our department.
“If we were to enter into 40 plus live trade negotiations, and have to get them done within the space of 14 months, you’ve got to bear in mind what is actually possible.
“But also most importantly we have the ability to return to those agreements in the future once we have made that transition.”
The SNP’s Angus MacNeil, chair of the Committee, accused the minister of failing to put himself in the shoes of other countries, such as South Korea, who will see Brexit as an opportunity to get a better agreement.
He said: “You think that other countries aren’t in anyway going to look for an opening – they seem to be quite agreeable.
“But isn’t this just a trade gambit of not showing their hand and if there’s last minute pressure on the UK for a concession before agreement, do you have a plan to deal with that or do you just wait and see?”
He added: “If you put yourselves in their shoes, any trade negotiator from a third country who is worth his salt and looking for a promotion from where he is at the moment, he’s not going to let this opportunity pass him by surely?”
Hands claimed other countries would not want to reopen talks on trade deals as they would not “want to risk the whole agreement and the whole trading relations to do that when both sides are clear that we don’t want to substantively change the terms of trade.”
The EU currently has active trade agreements with 65 countries and if the UK does not get these to agree to carry over its deals, World Trade Organisation (WTO) tariffs will be applied on goods.
Additionally, 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.
Last year, Fox revealed that while his department had been in discussions with many of the countries who have a free trade deal with the EU, no formal agreements have been reached about continuing those arrangements after Brexit.
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.”
Speaking to HuffPost UK after the meeting, committee member Chris Leslie said: “Ministers have got to wake up and smell the coffee because the reality of trade relations is starting to bite.
“In the real world, countries are not just going to roll over and do Liam Fox’s bidding, they are going to take the opportunity to try to press for better.
“By letting slip the limited capacity they have in the department, there are clear risks we are going to have trade deal chaos after March 2019.”