The UK has secured a commerce cope with Canada that can roll over the phrases of an current settlement between the EU and Canada when the Brexit transition interval ends on January 1.
Boris Johnson, UK prime minister, and his Canadian counterpart Justin Trudeau, settled the settlement in precept on Saturday in a video name. Mr Johnson hailed it as a “incredible settlement for Britain, which secures transatlantic commerce with one in every of our closest allies”.
UK items and companies exports to Canada are value round £20bn a 12 months.
The UK authorities hopes the continuity settlement will lay the foundations for talks subsequent 12 months on a “tailored” UK-Canada commerce settlement.
Worldwide commerce secretary Liz Truss mentioned the deal would offer “certainty” for 1000’s of companies.
She added that she hoped the UK-Canada rollover deal, like one concluded just lately with Japan, could be a springboard to wider commerce alliances: “In the present day marks one other step in direction of membership of a gaggle of like-minded nations — the Trans-Pacific Partnership.”
Past Japan and Canada, the UK has struck a variety of accords with different international locations, together with Norway, South Korea and Israel.
However negotiations are additionally nonetheless open with greater than a dozen different economies together with Mexico, Vietnam and Egypt — three international locations whose mixed buying and selling relationship with the UK was value near £12bn in 2019 for items alone.
If offers with them should not in place by January 1, buying and selling situations would revert to fundamental World Commerce Group phrases, with larger tariffs on UK imports and exports.
The settlement with Canada comes simply days earlier than the ultimate crunch level in talks over a UK-EU commerce deal.
Mr Trudeau instructed a FT International Boardroom occasion this month he was apprehensive the rollover deal wouldn’t be prepared earlier than January 1 due to a “lack of bandwidth” within the UK commerce division.
Ms Truss’s allies mentioned the Canada deal demonstrated the UK’s capability to succeed outdoors the EU by itself phrases.
One aide mentioned the deal was “a part of a much bigger strategic play post-Brexit, based mostly round deeper buying and selling tied with international locations past Europe — notably dynamic economies within the Americas and Pacific”.
The UK’s division for worldwide commerce mentioned that the rollover deal could be of explicit profit to the automotive, manufacturing and food and drinks industries.
For instance, zero tariffs will proceed to use for UK producers of agricultural exports, whereas UK automobile exports to Canada, that are value round £757m, won’t be topic to tariffs,
The appearing director-general of the CBI, Josh Hardie mentioned: “Agreeing a cope with Canada that secures continuity of commerce is nice information for companies on each side of the Atlantic.”