The US and China are reportedly among 20 countries attempting to block Britain from agreeing a fast-track deal with the World Trade Organisation (WTO) on its post-Brexit terms of trade with the rest of the world.
Liam Fox, the international trade secretary, admitted several WTO members had “expressed reservations” about the government’s plan to stay on terms similar to those it still enjoys as a member of the European Union (EU).
Britain is a full member of the WTO, but its membership is bound up with the EU, meaning it has to come to an independent agreement with the trade body.
Whitehall is now facing a series of separate negotiations with countries over the limits on the amount of certain goods which will be allowed into Britain, and what tariffs the UK will set on imports.
“As expected, some trading partners have expressed reservations about our proposed treatment of tariff rate quotas,” Dr Fox said in a written statement to the commons.
The arch-Brexiteer added the UK now “intends to enter negotiations with relevant partners”.
The negotiations will likely to be fraught with difficulties because countries around the world stand to lose and gain economically depending on how EU quotas are split between the bloc once Britain leaves.
Under international trade agreements, countries are often allocated export “quotas” by another country – which fixes an upper limit on how much product they are allowed to ship there.
The quotas usually apply to specific products and tend to be applied by countries to protect producers in their own country from competition – unfair or otherwise.
When the UK leaves the EU, countries need to work out what proportion of EU quotas – which were previously shared between the UK and 27 other countries as a single bloc – now belong to the UK.
The head of the Commons international trade committee, Angus Brendan MacNeil, said on Friday Dr Fox’s plans to rapidly establish the terms of WTO membership were in “tatters”.
“Liam Fox was hoping for a quick and easy process to establish the terms of the UK’s WTO membership before Brexit takes place,” Mr MacNeil said.
“When he gave evidence to my committee in July, Dr Fox assured me that this was all going fine. But his plan is now in tatters after the UK’s proposed WTO goods schedules faced formal objections from some 20 countries, including the US, China, Australia and New Zealand.”
MLex, a market analysis website, reported Russia had argued Britain’s proposals were inconsistent with its obligations “under several basic WTO provisions”.
But a department for international trade spokesperson insisted the development was “expected” and would “not impact our ability to trade independently”.
“The terms we have set out will form the basis of our trade policy while we engage with our WTO partners to address their concerns,” the spokesperson told the Financial Times.
Source: The Independent
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On 29 of March 2019 United Kingdom will leave the European Union. Will there be a deal or will we have a no-deal situation?
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