UK threatens to walk away from EU trade talks ‘if no progress within four months’
Britain laid out its opening demands for the upcoming trade talks with the European Union on Thursday, including a blunt threat to walk away from the negotiating table if there is no progress within four months.
The two sides appear headed for a rocky first round of negotiations as they try to forge a new relationship following the U.K.’s departure from the now 27-nation bloc.
Britain and the EU both say they want to reach a free trade agreement, but have starkly divergent views on how it should be overseen and what constitutes fair competition between their two economies.
The EU says Britain must agree to follow the bloc’s rules in areas ranging from state aid to environmental protections, and give European boats access to U.K. fishing waters, if the two sides are to strike a good deal.
But the U.K. is demanding the right to diverge from the bloc’s rules in order to strike new trade agreements around the world that it thinks will bolster the British economy.
“In pursuit of a deal we will not trade away our sovereignty,” Michael Gove, the minister in charge of Brexit preparations, told lawmakers in the House of Commons.
“We will not be seeking to dynamically align with EU rules on EU terms, governed by EU laws and EU institutions.”
Britain’s negotiating mandate insists that “we will not agree to any obligations for our laws to be aligned with the EU’s, or for the EU’s institutions, including the Court of Justice, to have any jurisdiction in the U.K.”
That conflict will be one of the big hurdles in talks, which are due to begin Monday in Brussels. Fishing is likely to be another flashpoint. EU nations - especially France - want Britain to grant European fishing boats long-term access to U.K. waters. Britain wants to negotiate fishing quotas annually.
Britain left the EU on Jan. 31 but remains bound by the bloc’s rules until a post-Brexit transition period ends on Dec. 31. A divorce agreement between the two sides allows for the transition to be extended for two more years, but British Prime Minister Boris Johnson insists he will not agree to that.
Johnson’s Conservative government says the U.K. will be leaving the bloc’s structures - including its single market for trade in goods and services - as of Jan. 1, 2021.
Britain hopes by then to have a trade agreement with the bloc similar to the one struck between the EU and Canada. Such a deal would eliminate tariffs and quotas on trade and goods, but it’s less clear what it would mean for the services sector that makes up four-fifths of Britain’s economy. The U.K. also aspires to strike side agreements in areas including fisheries, law enforcement and judicial cooperation.
The British government is warning businesses that no matter what happens there will be new barriers to trade between Britain and the EU, which currently accounts for almost half of U.K. trade. Even with a free trade deal there will be new border checks and customs forms to fill out.
The EU-Canada deal also took years to strike - now the two sides have just months.
Britain’s negotiating guidelines insist that there is “limited, but sufficient time” to get an agreement. The document says a “broad outline” of an agreement should be done by June. It warns that if there is not sufficient progress by then, the U.K. could walk away and focus on “domestic preparations to exit the transition period in an orderly fashion.”
Britain’s tough talk is unlikely to impress EU negotiators, who already accuse Johnson of trying to water down commitments Britain made in the divorce deal that paved the way for the country’s seamless departure on Jan. 31. That withdrawal agreement dealt with three broad issues - citizens’ rights after Brexit, Britain’s liabilities after 47 years of membership and the need to keep people and goods flowing freely across the border between EU member Ireland and Northern Ireland, which is part of the U.K.
The two sides have agreed to maintain an open border by keeping Northern Ireland aligned to EU rules even if the rest of the U.K. diverges. But recent comments by Johnson’s government seeming to downplay the significance of that agreement have set off alarm bells among EU leaders.
Behind the hard rhetoric, the two sides do have room for agreement. Britain has promised it won’t undercut the EU by lowering standards on environmental protection, food hygiene or workers’ rights.
But it won’t agree to let the EU be the judge of whether it is living up to those commitments. The challenge for negotiators will be to find a way to make that commitment binding that both sides can agree on.
“We’re not going to engage in some race to the bottom,” Johnson said. “All we want is mutual recognition of each other’s high standards, and access to each other’s markets.”
In Brussels, EU spokeswoman Dana Spinant said she “wouldn’t want to jump to conclusions about the outcome” of talks.
“However, the commission maintains its capacity to prepare for a no-deal (U.K. exit)” even as it prepares for “a positive result of those negotiations,” she said.
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