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Whilst the major Brexit preoccupation is the ongoing relationship between the UK and the EU and what that means for continuing trade, another important consideration is the UK’s ability to trade with other non-EU countries once outside the bloc.
It is not a given that the UK will be able to continue to trade on the same terms as currently exist with these countries. The Department for International Trade has confirmed that it will not complete a ‘rollover’ of all existing EU trade deals by 29 March when the UK is scheduled to leave the EU. To date, just six of the 40 or so trade continuity agreements the UK needs to enable trade with non-EU countries have so far been signed. Whilst exports to Switzerland and Chile for instance, will continue on almost exactly the same basis as today, negotiations with major trading partners, including Japan and Turkey, will not be concluded in time. For businesses exporting to countries where there is no rollover, it is unclear what will happen to their goods on arrival.
As for imports, publication of the Government’s plan for tariffs on goods coming into the UK has been delayed amidst speculation there will not be blanket zero tariffs. The Government faces a difficult choice here: zero tariffs would be simpler to administer and keep trade flowing in the short term. But, zero tariffs could damage the competitiveness of some UK industries who have been protected to date by EU tariffs.
I asked George Riddell, a trade specialist in Deloitte’s Brexit Insights team for his take on what businesses need to know:
Though time is now short, there are still actions that businesses reliant upon existing EU trade agreements can take:
In an era of unprecedented trade uncertainty and friction, companies that are aware of the risks and actively engaging with their stakeholders have the best chance of effectively landing their goods or finding a way to continue to access markets.
Find more information on how to plan for trade continuity in our technical trade paper here: Download Trade Technical Update.
Amanda is Head of Tax & Trade Policy for Deloitte UK. She leads a team undertaking analysis and preparing insights across the spectrum of tax and trade matters including Budgets, technical consultations, trade negotiations and post-Brexit border rules. Amanda has held a wide number of roles during her career including leading client relationships, global representative to the OECD, mentoring and non-executive board roles. As well as previously being a partner at another Big 4 firm, she was in industry at Vodafone plc as global head of indirect taxes and responsible for managing tax value chain and centralisation initiatives. Amanda has an active home life with four children and is also passionate about horses, riding whenever free time permits and supporting the charity World Horse Welfare including volunteering as Trustee and Treasurer for 7 years.