Trade

EU signs big trade deals as UK heads towards no-deal chaos

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You couldn’t get a bigger a contrast between the opportunities of EU membership and the emptiness of Brexit: the EU has reached a historic trade agreement with key emerging markets in Latin America while Tory leadership contenders brag about their plans for a no-deal Brexit. The EU is building bigger economic opportunities for its citizens. Meanwhile Boris Johnson and Jeremy Hunt compete with absurd Brexit promises of 100-day plans, taskforces, borrowed Canadian prime ministers and bungs to farmers.

Last Friday, the EU finally achieved a trade deal that has been 20 years in the making. Political agreement has been reached with Argentina, Brazil, Paraguay and Uruguay to enable free trade between their South American trading bloc, Mercosur, and the EU. 

The result will be a free-trade area covering 780 million people that will save EU exporters £3.6 billion a year in tariffs. This latest deal comes on top of the 15 trade agreements the EU already has with major economies like Canada, Japan and South Korea that have entered into force since 2014.

By contrast Brexit Britain hasn’t managed to reach an agreement with the EU that Parliament can accept, has rolled-over only eleven of the EU’s existing 40 trade agreements with 69 countries and we still can’t agree what kind of long-term trading relationship we should have with the EU. So much for “Global Britain” and that swashbuckling free trade agenda the Brexiters promised us.

July 20th

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As if this appalling mess was not bad enough, we now have a sordid contest between the final two Tory leadership candidates for the prize for the most outlandish no-deal Brexit promise. 

For Boris Johnson it’s leaving on Halloween “do or die, come what may”. But don’t worry because he has a powerful new plan: “a bit of positive energy”, no more “sitting around wrapped in defeatism” but instead securing a temporary trade agreement with the EU based on an obscure sub-clause 5(b) of Article XXIV of the World Trade Organisation’s General Agreement on Tariffs and Trade (GATT). However, that would rely on an EU agreement and the EU says that means signing up to Theresa May’s deal first.

Jeremy Hunt has unveiled a 10-point plan to deliver Brexit with lots of positive thinking too, plus a battery of committees and taskforces and a great big bung to farmers. Or is there? Hunt has promised to blow £6 billion in support to farmers and fishermen to compensate them for the losses that will result from the EU introducing tariffs on their exports. But when you look at the small print this is only a temporary scheme, it won’t protect families from the 10% increase in food prices predicted by the Bank of England and as the chancellor has pointed out this morning, there won’t be any money for farmers or anyone else if we crash out because all the Treasury’s reserves will be needed to plug the hole left by Brexit in tax revenues.

Despite the talk of taskforces and handouts from Hunt and Johnson, we face a choice this autumn: keeping all the benefits of big new trade deals through the EU or crashing out and wrecking the biggest trade deal we have already. Why will they not give us the choice in a new referendum? It is because they are afraid that staying in the EU would win.

The post EU signs big trade deals as UK heads towards no-deal chaos appeared first on InFacts.

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