Interview: Britain may face years of trade talks with Brussels, former ambassador warns

Source: Xinhua| 2019-11-04 23:12:24|Editor: Wang Yamei
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by Gui Tao, Larry Neild, Zhao Yinuo

LONDON, Nov. 4 (Xinhua) -- With Britain now in the grip of a snap general election, the fate of the country's membership in the European Union (EU) remains uncertain, although Prime Minister Boris Johnson claims if he wins, Britain should leave the bloc in January.

Britain's departure from the EU will be just the starting point in a rocky and uncertain journey that may continue for years, and almost certainly into the second half of the 2020s, said Ivan Rogers, Britain's former Permanent Representative to the EU, in a recent interview with Xinhua.

Withdrawing from the EU is merely the first hurdle that will be followed by lengthy negotiations on a permanent trade and working arrangement between Britain and Brussels, said the man in the front-row of Brexit for some years.

He resigned as Britain's ambassador in 2017 after a highly publicized fallout with former Prime Minister Theresa May's Brexit negotiating team.

Now as an independent consultant and a Brexit expert, he gives his opinions to financiers and investors about what a Britain, unshackled from Brussels, will be like as a stand-alone trading nation.

WORSE DEAL

One big question he is asked is what will happen after Britain withdraws from the EU.

"All we have done so far is the Brexit withdrawal agreement which just covers money, citizens rights, the Irish border question. It's cleverly marketed as if it's a great negotiating success, but actually Britain's present Prime Minister Boris Johnson has given something that previously he would always have opposed," said Rogers.

He was referring to the critical issue of the border between Northern Ireland and the Republic of Ireland, and the search for a deal that guarantees there will be no frontiers on the island of Ireland.

Johnson, said Rogers, has now resolved the border issue, basically by caving in.

The latest deal, brokered by Johnson, would see Northern Ireland staying in the EU single market, but would, like the rest of Britain, be outside the EU's customs union. The complicated arrangement would see a border down the Irish Sea, separating Northern Ireland from the rest of Britain.

Rogers explained: "The only deal that's been done is not the trade deal, this is what I keep on saying to investors. It's the divorce deal, the withdrawal agreement. We haven't done anything on the future economic relationship."

Rogers noted that the difference between Johnson's Brexit and May's Brexit is that he wants to go much further out into the mid-Atlantic.

"From my point of view, from an economic point of view, a Treasury point of view, and a corporate sector point of view, the people I am advising, it's much worse than May's deal. My view is the Johnson deal is worse for the (British) economy," said Rogers.

TRADE NEGOTIATIONS

Looking ahead beyond the snap election, Rogers believed that Johnson, should he win, would probably try to start trade negotiations with Brussels in 2020.

"His people are saying we can do a complete free trade negotiation and have it done in 2020 and ratified by the end of 2020 so that we leave at the end of a transition period on Dec. 31 2020. This is a complete fantasy and there's an absolutely zero chance of this happening," said Rogers.

Responding to suggestions it may take 10 years to resolve a future trade relationship with Brussels, Rogers said, "We've already had three and a half years (since the 2016 EU referendum) and we haven't yet started the difficult stuff from financial services to fishing, aviation, electricity and gas to road haulage."

"All the economic stuff remains still to be negotiated," said Rogers, believing Britain could do a serious free trade deal with the EU likely in another two to three years.

"But then you require ratification. The problem with a free trade deal is where it gets very complex. A free trade deal in with the EU is not just a deal with the European Commission," said Rogers. Other parts of the EU come into play, from the European Parliament to the individual 27 member states of the bloc.

Rogers cited the deal between Brussels and Canada as an example.

"I worked on the Canada deal which everybody says was a great deal and one of the most straightforward the EU has done. We're now in year 10 and still bits of it haven't come into force. It took about seven years to negotiate from beginning to end."

Rogers admitted to being sceptical about suggestions that Britain, as a member state of the EU for over four decades, will have an easy journey.

"Johnson and key ministers say it's simpler for Britain because they already know us, and we are already converging and aligning on all their standards because we've been in the EU for 45 years," Rogers said.

"But we want to leave, because we want to diverge from their standards."

Rogers has spoken to investors in Asia, the United States and in Europe about the difficulties.

"Under Johnson, Britain is also leaving the EU customs union because he wants a sovereign independent trade policy. He wants to run a different trade regime, and to be able to have different trade agreements with third countries from China to the U.S. to India," he said.

"But if you're leaving the customs union that inevitably creates friction in trade with your old EU partners," he added.

CRISIS COMING

Rogers highlighted another problem for British businesses, saying the vast majority of British exporters largely export to the EU.

"They've never exported anywhere else so the vast majority of people who export in this country have never exported outside a custom union, and exporting outside a customs union carries more bureaucracy and red tape than inside the customs union," he said.

The bottom line: Britain will not have a free trade deal by the end of 2020. "The crisis coming," said Rogers.

"I say to companies there's a crisis coming this time next year. It'll be obvious by then we haven't got a free trade agreement and we're nowhere near having a free trade agreement," he lamented.

Brexit isis the biggest change to the British economy since the Second World War, and "It's a complex process of extricating yourself from a union you've been in for 45 years which has got into every area of British social economic political life," he said.

His solution is for Britain to have a realistic serious non-fantasy assessment of what its choices are.

"This is a really big strategic set of questions for the country, and we're going to spend the next two or three decades thinking about the consequences of Brexit," he said. "My worry is you plunge straight into the crisis in 2020 because you promised something to the public that they're not going to get."

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