The Brexit transition period ends in less than 50 days and the probability of UK firms facing major disruption at the end of it is growing. The Department of International Trade (DIT) worked hard earlier this week to meet today’s deadline to propose trade agreements to the parliament that are to replace those that the UK is going to lose as a result of leaving the EU.
Liz Trauss, heading the DIT was to table before parliament more than £80bn worth of free-trade agreements with countries such as Mexico, Singapore and Canada by 11th of November. Trauss’s department was under a lot of pressure having been reminded by the shadow international trade secretary Emily Thornberry on Tuesday that unless the deadline is met, there will not be enough time under the law for the MPs to rectify them.
On Monday, two parliamentary reports have been published pertaining free-trade agreements with Ukraine and Ivory Coast. This left 15 more countries to be discussed between Monday and Wednesday. Thornberry criticised the loss of momentum the DIT faced in 2020, having completed far less continuity agreements this year, in comparioson to the 20 that were made in 2019. In her letter, which she also posted on Tweeter, she writes: “In many cases, your department has had more than four years since the Brexit referendum to secure the 15 outstanding continuity agreements.”
When commenting on their ability to meet today’s deadline the DIT spokesperson said “It is misleading to say there’s a hard deadline on this.” Trauss has said previously that their aim is to give at least 10 days for the committee to read through the reports on a confidential basis.
If however, the continuity agreements are not completed in time, the UK would have to revert back to the less favourable World Trade Organization trading terms. An analysis by the Independent has found that if the 15 missing deals are not agreed upon in time, the UK “could see tariffs and quotas imposed on £38bn of British exports and £41bn of imports, potentially causing havoc for some firms.”
Many UK businesses would like to see a continuation of the free-trade agreements to limit the disruption to trade after the transition period ends on the 31st December this year. Whether this is the case depends on the governments ability to complete the talks with the rest of the country partners and present agreements before parliament in time. At UKCS we are continually monitoring the situation to be informed and able to assist all of our clients in the upcoming months. If you’d like to speak to one of our experts, please get in touch.