EU and UK now see no deal as the most likely Brexit scenario | NOW



The likelihood of a trade agreement between the European Union and the United Kingdom seems to be getting smaller by the day. Both the UK and the EU now see a so-called ‘no deal’ as the most likely scenario, the leaders of both camps said on Friday. Earlier this week, the two parties agreed to make a decision on Sunday about whether it makes sense to continue negotiations.

The British are still unofficially part of the EU and will follow all European rules until the end of the transition period, 1 January. Those rules expire when the two blocks are unable to reach an agreement on a trade agreement.

Negotiations on this have been difficult throughout the year and two talks between the highest political leaders, Boris Johnson and Ursula von der Leyen, failed to break the deadlock. As a result, a no deal now seems almost inevitable.

“It seems very, very likely that we should go for a solution that will be great for the UK,” British Prime Minister Johnson said on Friday of the no-deal scenario. “We can then do exactly what we want from January.”

A British exit from the EU without a trade deal would also be the most likely scenario on the other side of the Channel. President Von der Leyen of the European Commission is said to have said this to the 27 EU government leaders at the European summit in Brussels on Friday. “The chance of a no deal is greater than the chance of a trade agreement,” von der Leyen is said to have said, according to a diplomat.

Fishing and competition rules, among other things, are major stumbling blocks

The negotiators of both sides have been bothering about three subjects for months: fisheries, competition rules and supervision of compliance with the trade agreement. With only twenty days to go until the new year, the chances of an agreement appear to be quite small, given the large differences.

If the parties fail to reach an agreement, trade between the EU and the UK will revert to the standards of the trade organization WTO. That means moving from relatively hassle-free free trade, to the return of toll booths and import duties on products traded between the UK and the EU.

For example, if the British want to import Dutch minced meat, an import tax of 48 percent would have to be paid according to WTO tariffs. The British trade association for retail trade BRC therefore warned Friday against more expensive groceries in the event of a no-deal Brexit.

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