UK, EU push for a comprehensive and balanced trade relationship

Thursday, 2020-06-18 16:06:27
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European Council President Charles Michel and European Commission President Ursula von der Leyen take part in the high-level video conference on Brexit with UK Prime Minister Boris Johnson. (Photo: European Council Audiovisual)
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NDO – A recent meeting via video conference between the leaders of the UK and the European Union (EU) is being viewed as positive and having added impetus to negotiations on bilateral trade relations in the “post-Brexit” period.

However, the issue of a “level playing field” is a key requirement, but also a major obstacle, which can only be addressed when both sides make concessions, in order to get a trade deal later this year as is targeted.

The high-level virtual meeting on June 15 featured the attendance of leaders from the two sides, including UK Prime Minister Boris Johnson, President of the European Commission Ursula von der Leyen, President of the European Council Charles Michel and President of the European Parliament David Sassoli. This was also the first time PM Johnson directly negotiated with the EU leaders since the UK left the bloc on January 31, 2020. The meeting has thereby brought new political impetus to the negotiation process on post-Brexit UK-EU relations, which is currently at a standstill. In a joint statement issued after Monday’s meeting, the UK and EU leaders reaffirmed their commitment to cooperate for the benefit of the people of both sides, as well as supporting strengthened negotiation plans aimed at achieving a comprehensive and balanced agreement before the end of the Brexit transition period by the end of 2020.

The high-level UK-EU meeting took place after a series of rounds of negotiations had been held, even as the COVID-19 pandemic still remained complex, but there seemed to be no signs of “breaking the deadlock”. Except for a commitment to “keep negotiating”, most of the discussion points had not made any progress after four rounds of talks since January. However, in the latest round of negotiations last week, the two sides agreed to set up a new, denser working schedule, with weekly dialogues, instead of once every two or three weeks as was previously the case. At least five rounds of talks are scheduled to be held between the two sides from June 29 to July 27.

The biggest barrier is still disagreement between the two sides on an array of key issues, especially regulations regarding businesses. Views on fishing still differ as the UK resolutely objects to the EU’s request for “long-term access” to British waters. The two sides are also in dispute over environmental, financial and social standards, maintaining firm and unyielding stances. The EU said it would not sacrifice its interests for the purpose of obtaining a trade deal, adding that it feels the UK side has only acted as the “referee” in negotiations, but not as a “player” directly involved in the “match”. In general, the critical bottleneck lies over four issues, including sharing the UK fishing grounds with the EU, the role of the European Court of Justice (ECJ), dispute settlement mechanisms, and regulations on a “level playing field”.

In particular, a “level playing field” is the biggest barrier as it is at the request of both sides who, however, could not agree on the specific regulations concerned. Arguing that the “level playing field” is a core element for the establishment of an economic partnership, the EU is requiring the UK to accept the principle of equality, especially in matters related to state subsidies, labour and the environment. Meanwhile, London is also demanding equality for the UK in a free trade agreement with the EU, similar to what the EU signed with partners such as Canada and Japan. The UK also demands the maintenance of existing regulations concerning fishing rights in British waters, while rejecting the EU proposal on the ECJ’s role in resolving post-Brexit disputes between the UK and the EU.

Facing such disagreements with little time left for dialogue, the leaders of the two sides have determined that it is impossible to solve the deadlock in the negotiations if they insist on their views. At the video conference meeting, the UK received a positive signal from the EU who pledged to exert joint efforts with London to soon reach a common consensus on trade and security issues, avoiding a scenario where the two sides’ economies falls into crisis after Brexit. The two sides also reiterated their commitment not to extend the transition period, slated to end on December 31, 2020. This means that the two sides only have just over six months left to prepare to adapt to a new business and trade environment which is much stricter and far different from the current regulations.

There was no breakthrough after the online UK-EU high-level meeting, but at least the two sides have affirmed their political determination at the highest level with the aim of reaching a consensus on a comprehensive and balanced trade relationship in the future. This will depend on upcoming concessions between the two sides aiming to turn political commitments into specific actions.