Post Brexit: Who to trade with?

The United Kingdom’s administration is still trying to coordinate its adequate commerce partners despite the international situation  

Post Brexit

Whenever the United Kingdom leaves the European Union, it will default to trading under the World Trade Organization’s (WTO) rules and regain the capacity to sign free trade agreements (FTAs) with other countries around the world. This was one of the most used arguments to promote the exit of the UK from the EU, but now the situation is complicated; trading with the European nation does not benefit all countries. As of now, the only nation willing to establish commerce with the British is the United States.

At the beginning of each international agreement, both parties have to convince the other that they are the best alternative. When it comes to countries like China, it is best for them to continue under the rules of the WTO before signing anything with the United Kingdom. For the Asian nation, all taxes on products do not surpass 2% so drifting into another arrangement doesn’t seem feasible.

On the other hand, the European Union is trying to persuade the United Kingdom to maintain standard workers’ rights, unions, and fair competition for all within society. This is based on the argument that trade deals will only be possible if the terms remain the same as those under the WTO; “there cannot be preferences of damage to the internal society just to look better than others”, declared Michel Barnier, the chief negotiator of the EU.

The United States, led by Donald Trump, is looking to achieve a deal with the United Kingdom; Trump and May seek to increase jobs in said country. The leaders of the European nation must analyze the situation thoroughly since leaving the European Union means letting go of about 34 pre-established commerce treaties. For some businessmen in the UK, the country is losing its credibility and it will make them lose opportunities and gain a negative reputation, “it is not enough a trade deal with the US, the car industry has many variables, and one of them is the constant trade with other countries, especially within Asia. The EU will smash this sector of the UK if we do not move fast,”, affirmed Philip Hammond, a member of Parliament.

The UK government is currently analyzing the agreements made by the European Free Trade Association (EFTA) which could allow the United Kingdom to have access to commerce while establishing its own treaties This organization only involves Switzerland, Norway, Lichtenstein and Iceland, but it gives the opportunity to partake in almost all of their trade deals. Hammond thinks this is the only post Brexit salvation for the economy, as of right now. The member of Parliament stated, “we must to consider a shortcut in free trades and focus on the short post Brexit term; there is no time to wait years of negotiation and settle the problems, time is not a friend at this moment”.

 

Latin American Post | Carlos Eduardo Gómez Avella

Copy edited by Susana Cicchetto

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