The UK has secured a commerce cope with Canada that can roll over the phrases of an present 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 “implausible settlement for Britain, which secures transatlantic commerce with one in every of our closest allies”.
UK items and companies exports to Canada are price 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 supply “certainty” for hundreds of companies.
She added that she hoped the UK-Canada rollover deal, like one concluded not too long ago with Japan, can be a springboard to wider commerce alliances: “In the present day marks one other step in the direction of membership of a bunch 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 price near £12bn in 2019 for items alone.
If offers with them will not be in place by January 1, buying and selling circumstances would revert to primary 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 World Boardroom occasion this month he was nervous 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 skill to succeed exterior the EU by itself phrases.
One aide mentioned the deal was “a part of an even 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 can be of specific profit to the automotive, manufacturing and foods and drinks industries.
For instance, zero tariffs will proceed to use for UK producers of agricultural exports, whereas UK automotive exports to Canada, that are price round £757m, is not going to be topic to tariffs,
The performing 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.”