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EU rejects FTA with UK


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2020 Feb 20, 2:07pm   257 views  0 comments

by MisdemeanorRebel   ➕follow (12)   💰tip   ignore  

Because the goal is to intimidate the current EU members from leaving also. Self-Preservation and Geopolitics, not economic benefit, is the driving force of Eurocrats.

The UK government, by proposing a Canada-style free trade deal with no regulatory alignment or other onerous economic conditions, has smoked the EU out. Three years ago, the EU Commission produced a ‘waterfall’ chart showing a Canada-style deal as the likely end point for the UK-EU future relationship. They also argued that the UK must choose from a range of existing models of EU trade relations with other economies, including the Canada deal – a ‘bespoke’ deal was not available.

But this week, Monsieur Barnier announced that a Canada deal was, in fact, not available. Moreover, the EU now argues that the future relationship with the UK must be ‘unique’. So, the Commission has completely shifted its ground, at least publicly. In reality it is likely that the EU was never serious about agreeing a Canada-style deal as it assumed the UK government would not be interested in such an arrangement.

Let’s look at some of the EU’s recent arguments as to why a Canada-style deal is not acceptable:

The UK is making an ‘unprecedented’ request for zero-tariff and zero-quota trade. It’s true that EU FTAs with Canada, Korea and others don’t eliminate all trade barriers. But they do eliminate the vast bulk of them, with typically 98-99% of tariffs removed. So, this is a weak argument and could easily be rebuffed from the UK side by accepting that some areas such as sensitive agricultural items could be excluded from any deal.
The UK is very close geographically and ‘economically intertwined’ with the EU. Both points are of course true. But such considerations have not prevented the US from agreeing free trade deals with Canada and Mexico which do not include the onerous ‘level playing field’ conditions or other extreme demands the EU wants in a UK trade deal. And more pertinently, such considerations did not prevent the EU itself agreeing a whole series of traditional free trade deals with the EFTA countries in the 1970s. At the time, these countries accounted for around 20% of extra-EU trade – which by coincidence is very similar to the share of extra-EU trade the UK now accounts for. Then, the EU’s aim was apparently to preserve trade with important partners, now it isn’t.

The EU’s real motives are twofold – to protect itself against sharper international competition and to prevent other EU member states from being encouraged to follow the same path as the UK.

It’s ironic that while UK Remainers agonise endlessly over the supposed disastrous effects of the UK breaking away from the EU’s trade and regulatory system, the EU Commission appears to fear the precise opposite – that such a breakaway will allow a more nimble UK to thrive and leave the EU in its wake, and that such an outcome might encourage other member states to follow the UK out of the door.

Indeed, the EU actually appears to accept the argument recently advanced by David Frost that what the UK does domestically in terms of altering and improving its economic model is more important than trade arrangements. Clearly the EU doesn’t believe non-tariff barriers are going to be 20% or 30% of trade values as some UK Remainers have claimed after the UK leaves the single market and customs union – if there were going to be barriers of this scale, ‘geographical proximity’ would hardly matter and UK businesses’ competitiveness in the EU would be hobbled regardless of clever changes of UK regulation.

https://briefingsforbritain.co.uk/eu-isnt-interested-in-free-trade/
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