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An agreement on the terms of the future relationship between the UK and the European Union in bilateral trade in goods will provide 100% tariff liberalization, of which the British government published substantive details on Friday.
The 1,246-page document, which includes 800 pages of appendices and footnotes, was agreed upon by negotiators between the British government and the European Commission on Thursday night after months of negotiations.
The 34-page excerpt released by 10 Downing Street on Friday night says it is unprecedented that the trade deal in the deal includes 100 percent tariff liberalization.
This means that no customs duties or quotas will apply to trade in goods between the UK and the European Union if the goods meet the relevant certification requirements.
According to an excerpt published by the British government, this is the first time that the EU has agreed on a trade regime without tariffs and quotas with an external trading partner.
Before reaching a deal, the British government regularly mentioned, among the possible outcomes of the negotiations, that bilateral trade would resume on an “Australian-style” basis after the end of the current transition period.
This, in fact, would have meant the lack of a global agreement, in which case trade between the UK and the EU would have continued from January under the general rules of the World Trade Organization (WTO). This would have meant the appearance of tariffs on bilateral merchandise trade, the risks of which the British business sector has constantly warned the government.
The British Association of Car Manufacturers and Dealers (SMMT) said in its annual assessment of the situation, presented shortly before the deal was reached, that it calculated that
It would cause 110 billion euros in production losses by 2025.
According to the summary presented on Friday, the agreement also covers the service sectors. The document states that additional market access will be provided to a wide range of service sectors, including financial, legal and commercial services. However, the excerpt does not specifically mention the conditions under which financial services companies in the London financial sector, City, can continue to be present on the EU financial services market. Since the start of the Brexit process, City’s financial services companies, especially investment banks, have feared losing their passport rights, that is, their service licenses for the euro zone markets, in the absence of a specific agreement on financial services.
A leading London financial analyst, the Center for London, estimates that if London’s financial center loses access to the European Union’s single internal market, it could result in the loss of 70,000 financial services jobs in the City, which currently employs more than 300,000 people.
According to the analyst firm, this would be a disaster, as the value of exports of financial services and other related services within London’s total independent exports reaches £ 100 billion a year. This is half of London’s total exports as an independent economic entity.
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