- The United Kingdom and the European Union arrived this Thursday, at the end of tough negotiations, to a post-Brexit free trade agreement.
- This agreement, the announcement of which was expected this Thursday morning but finally took place around 3:45 pm, makes it possible in extremis to avoid a potentially devastating “no deal”.
- In the absence of an agreement, relations between the United Kingdom and the EU would have returned to WHO standards, thus including quotas and customs duties.
This time, is it the right one? Santa Claus therefore brought as a gift to Europe a post-Brexit trade agreement which avoids, one week before the deadline, a “no deal”. After ten months of fierce negotiations, the European Union and the United Kingdom have succeeded in reaching a historic agreement on their future trade relationship.
During a press conference, Ursula von der Leyen, President of the European Commission reacted to this historic agreement. It’s a “good, balanced” and “fair” deal for each part. She spoke “not of joy, but of satisfaction and relief”. The deal “will allow us to make sure that we can finally leave Brexit behind us,” she added. For his part, Boris Johnson simply confirmed: “The agreement has been found with the European Union”.
The deal is done. pic.twitter.com/zzhvxOSeWz
— Boris Johnson (@BorisJohnson) December 24, 2020
What does the agreement contain?
On the subject of fishing, a stumbling block between the EU and London, an agreement was finally found which provides “a basis for reciprocal access to water and resources, with a new distribution of quotas and fishing opportunities, explained Michel Barnier. This agreement will require efforts, I know, but the EU will be present alongside European fishermen to support them, that is our commitment, ”he promised at a press conference.
Despite its low economic weight, the sector is of political and social importance for several Member States, including France, the Netherlands, Denmark and Ireland. But the British made it the symbol of their regained sovereignty after the divorce. The negotiations focused on sharing the some 650 million euros of products caught each year by the EU in British waters and the length of the adjustment period for European fishermen.
Other previously problematic subjects – how to settle disputes and protections against unfair competition – have for their part been settled in recent days. Michel Barnier expressed two regrets: the non-participation of Great Britain in Erasmus and the less freedom of movement within the Union.
What will the next steps be?
This compromise between the European Commission and the United Kingdom will still have to be validated by the 27 member states, which should take several days, as well as by the British Parliament and the European Parliament. But it is expected that this treaty will enter into provisional application on January 1, and that in a second step, the text of nearly 2,000 pages, is validated a posteriori by the European Parliament. Remember that the United Kingdom left the European Union on January 1, 2020, but will leave the common market on January 1, 2021.
What does this agreement change?
With this agreement, negotiated by Michel Barnier on the European side and David Frost on the British side, the EU offers its former member state unprecedented access without customs duties or quotas to its huge market of 450 million consumers. Without an agreement, the United Kingdom would have lost much more than Europe: the British export 47% of their products to the continent, while the EU only sells 8% of its goods across the Channel.
But this openness will be accompanied by strict conditions: companies across the Channel will have to respect a certain number of evolving rules over time in terms of the environment, labor law and taxation to avoid any dumping. Guarantees should also exist in terms of State aid. A mechanism should allow both parties to quickly activate countermeasures, such as tariffs, in the event of discrepancies on these standards.