A WTO Brexit is Britain's best bet
A so called "no-deal" Brexit is in fact a misnomer. Leaving the EU on WTO terms is by far the best way for Britain to re-emerge as a power house in international trade. Let's get Britain out, and let's just do it
This last week has seen a big boost to the future of Britain's trading relationships. We have seen agreements made and signed with several countries including the United States and Israel which state, in the case of a WTO ‘No Deal’ Brexit, that the UK would continue to trade with countries as we do at the moment, with no cliff edge and no uncertainty for business.
These are real world events which once again suggest a WTO ‘No Deal’ approach to Brexit is the best way to go. However, the only way we can provide this certainty to business and our trading partners is actually to move forward with a WTO Brexit.
The Withdrawal Agreement and the odious Malthouse Compromise only increase uncertainty as a result of vague language about how free the UK will be to make trade deals in the future and they both, as a result of long transition periods, delay the start of a truly global Britain.
While things are not going exactly to schedule with only 6 new trade agreements completed and ready to begin in the event of No Deal on the 29th March, Dr Liam Fox MP, the Secretary of State for International Trade, is confident other agreements are proceeding and will be done in time, even if they come down to the wire.
It is important to clarify, only 11% of the UK’s trade is dependent on EU agreements with foreign countries. This will only fall as we separate ourselves from EU agreements and sign our own ambitious trade deals. This is something which would be accelerated by leaving on WTO Terms, allowing the UK to be free of EU legislation.
Official trade talks have slowed down because many countries are waiting to see what type of deal the UK leaves the EU with. In the event some form of the Prime Minister’s Deal gets voted through Parliament in the next few weeks, and we don’t have the clear opportunities of a WTO ‘No Deal’ Brexit, the UK cannot – at the moment - say what tariffs would apply during or after any ‘Transition Period’.
Last week, we saw a mutual recognition agreement signed by the US and the UK. The agreement means current EU-US legislation is carried across until the two countries can come to an official trade agreement. As a result, regardless of Brexit, companies can continue to trade with the US as we do now.
This opens the door for further negotiations following Brexit -- a situation in which we can all see mutual benefits from signing a formal comprehensive trade deal with the US once we are completely free of EU control. This agreement is good news, for example, for one of the biggest sectors of the economy -- the pharmaceutical industry.
Likewise, the UK has now signed a similar agreement with a group of other countries including Israel, Switzerland, Australia and New Zealand. The Israeli deal is of vital importance, as at the moment many Israeli pharmaceutical groups work with British counterparts to provide medicines to the NHS. In fact, Teva Pharmaceuticals, an Israeli company, is the largest manufacturer of generic medicines in the world. This should help to banish the ‘Project Fear’ arguments surrounding the UK being cut off from medicines after Brexit.
At the moment, the UK is making progress on trade talks with major partners such as Japan and China, although currently there is a growing dispute over how to move forward with both countries. This is especially the case regarding China, with whom there are concerns over their human rights record, and their actions in the South China Sea.
According to sources, the Chinese have ‘thrown their toys out of the pram’ because Gavin Williamson, the UK’s Secretary of State for Defence, has committed to sailing the New QE2 aircraft carrier into the seas around Taiwan. While this setback is not ideal for trade between the UK and China, it is an important example of the UK being able to exercise itself as a global power, setting its own trade agenda policy and not having to kowtow to the big business interests which dominate the EU bureaucracy.
Liam Fox has also announced that a potential trade deal with Japan will not be ready in time for March 29th. The problematic nature of this situation is compounded by the fact the UK is uncertain as to what tariffs and commitments it will be able to make as a result of the current uncertainty around the Withdrawal Agreement. Additionally, we are two huge economies and as such it is complicated.
However, in a statement published by the Department of International Trade on February 21st, there is this commitment: “More trade deals are due to be signed and announced in the coming days and weeks.”
In order for the UK to actually be able to pursue such an ambitious trade policy, the we need to pursue a good deal with the EU. The current Withdrawal Agreement is not a good deal, and severely limits the UK’s ability to sign off trade deals with countries around the world, allowing the cost of living in the UK to be reduced and the economy to expand and diversify.
Theresa May’s intransigence over her Withdrawal Agreement is creating doubt and delay where there should be certainty by now. We cannot expect our old allies such as Australia, Canada and New Zealand to wait around while we hang on to the EU’s coat-tails – potentially tied to the EU over the inescapable Irish ‘Backstop’. Quite simply the only way we can now get a good deal that delivers Brexit is to leave on WTO Terms.
(This trading issue is not the only problem with May’s Withdrawal Agreement. You can read a collated list of 8 Major Faults with May’s Deal here, which we have researched and investigated.)
In order to successfully Get Britain Out of the EU and pursue successful trade agreements for Global Britain with countries around the world, we have to Leave the EU with the right deal.
This is not Mrs May’s Deal, nor the suggested Malthouse Compromise. Time and again, on the platform of trade post-Brexit, we have had to listen to defeat being anticipated by the Remainers with ‘Project Fear’ scare stories.
Countries have already stated their intentions to do deals with the lucrative UK market, and these deals are being progressed. All of this is happening despite the hurdles which have been placed in our way, whether by the abhorrent Withdrawal Agreement, disgruntled Remainer civil servants, or the ongoing petulant actions of the EU.
There is a great future for British trade. We are beginning to see the opportunities open to us once we finally escape the shackles of the EU.
Joshua Mackenzie-Lawrie is a Research Executive at the grassroots cross-party campaign group Get Britain Out
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