Insight
The future EU-UK relationship and the (relative) case for optimism by Sam Lowe 2 March 2020
Beyond the headline disagreements, both the EU and UK have similar expectations as to what a future free trade agreement can and cannot deliver. Both the EU and the UK have now identified what they want their future partnership to look like. Big differences exist between the two parties. The sensitive issues include disagreement over the role of the European Court of Justice (ECJ); whether EU fishing vessels should be able to access UK waters on the same terms as now; the exact nature of so-called level playing field provisions relating to environment, labour and state aid rules; and whether the entire partnership – encompassing trade, security and transport, amongst other things – should be one big agreement with shared governance provisions, or split into distinct, separate agreements. However, largely due to the UK’s lack of ambition, on the core fundamentals of what a future trade agreement between the EU and UK should look like, the parties are more aligned than not. The British government, on the face of it, accepts the consequences of leaving the single market and customs union, and acknowledges that a free trade agreement means friction at the border, and new procedures and red tape for companies. So the question becomes one of whether the EU and the UK can meet each other half-way on the issues of contention. The answer is “probably not” in the next month or two – the consequences of failing to reach a deal are too distant, the temperatures on both sides of the Channel too high and the appeal of domestic posturing too great. But assuming that a hard December 31st deadline will focus minds later in the year, it is possible to map an eventual route out of the quagmire. On the future trade agreement, the UK wants to remove all tariffs and quotas, as does the EU. There is broad agreement as to the coverage – with both parties seeking the inclusion of chapters covering issues such as services, transport, intellectual property and telecommunications. Of course, there are some areas of disagreement – for example, the EU’s negotiating mandate provides that audio-visual services should be excluded from the scope of economic partnership, while the UK wants it covered – but no major points of contention. As such the EU and UK are finally speaking the same language, and the objectives of the two parties reflect that.
CER INSIGHT: The future EU-UK relationship and the (relative) case for optimism 2 March 2020
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