Brexit: UK and Canada agree deal to keep trading under European Union terms

Elias Hubbard
November 22, 2020

Durocher said the next step for Canada is to continue to fine-tune agreements with both the European Union and the United Kingdom, ensuring the best for Canadian businesses.

The interim deal beat the looming December 31 Brexit deadline, replacing Canada's current agreement with Britain under the European Union that covers trade between the two countries. Canada is the U.K.'s eighth-biggest non-EU trading partner.

Britain is now locked in fraught talks with the European Union to set the terms of their future trading relationship for when the post-Brexit transition period ends on December 31.

It has yet to strike a deal with the European Union, although negotiations are ongoing.

The U.K. still needs to roll over 14 other European Union agreements by January 1 to avoid defaulting to World Trade Organization terms, including with nations such as Mexico, Turkey and Singapore - agreements which cover about 60 billion pounds of trade with Britain. The deal could include "the potential to go further in areas like digital trade, the environment and women's economic empowerment", a release from the British government said.

UK Prime Minister Boris Johnson and his Canadian counterpart Justin Trudeau agreed in the video call today to rollover current EU-Canada trading arrangements and begin negotiations on a new, UK-Canada trade deal in 2021.

Britain imports products such as salmon and maple syrup from the Commonwealth country that also recognizes Queen Elizabeth II as head of state.

The U.K. has now secured post-Brexit trade deals with 53 countries accounting for 164 billion pounds ($218 billion) of bilateral trade, the government said.

The Canada deal would be the second major trade accord announced by Britain in less than a month, after it agreed to terms with Japan in late October.

Josh Hardie, the acting director-general of the Confederation of British Industry described the agreement as a "milestone", adding: "The signing of this deal can now lay the foundations for an even deeper trade agreement, tailored to both economies".

Although both sides have indicated that progress has been made in recent days, long-standing differences on the access of European fishing fleets to United Kingdom waters, common regulatory standards, known as the "level playing field" and dispute settlement remain, and compromises are unlikely to be found until the eleventh hour. Failure to do so would see EU-UK trade conducted on World Trade Organisation terms. The deal includes zero tariffs on vehicle exports, and tariff-free trade on goods including beef, fish and seafood.

Other reports by Click Lancashire

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