The two sides are miles apart on this fundamental issueby Jill Rutter / February 18, 2020 / Leave a comment
Beavertails. Mounties. Maple leaves. This is just some of the Canadiana admired in the UK—alongside Canada’s trade relationship with the European Union. Ministers have repeatedly set out their desire to use Canada as a model for the UK’s future trade arrangements with the EU.
But they failed to read the fine print in the EU’s original negotiating guidelines. This set out the conditions the UK must sign up to as a condition of its desired access to the EU’s market. Brussels wants to maintain a “level playing field” to prevent the UK rowing back on standards, gaining a competitive advantage and undermining the bloc’s ability to maintain its rules. This will become the defining fight of the trade negotiations, and if neither side moves, could mean the transition ends not just with no trade deal, but also no security cooperation—and an awful lot of mutual recrimination.
As EU Chief Negotiator Michel Barnier puts it, zero tariffs and zero quotas, the UK’s principal ask on goods trade, comes with a third zero: “zero dumping”—not necessarily in the normal sense of tipping a load of, say, below cost surplus steel into a market, but in the sense of unfair competition from a UK no longer bound by single market rules. Angela Merkel reminds us on a regular basis that after Brexit, the UK goes from being a member state to a third country competitor, and must not be allowed to undermine the EU from outside.
The EU has repeatedly insisted that while the UK can choose an off-the-shelf model from the “Barnier staircase,” the UK is not Canada. It is too big, too close geographically and too intertwined with the EU economy after 47 years of membership. Memo to Dominic Raab: the Channel is smaller than the Atlantic.
The new draft EU mandate, being battled over in Brussels in the run-up to adoption by member states at the end of the month, sets out the areas of concern. It requires the UK not to move back from the EU’s environment or labour standards in force at the end of the transition. It wants it to maintain transparency and cooperation on tax. And it wants the UK to continue to apply…