In a speech today, the Prime Minister described the key principles and priorities that will govern the UK’s approach to negotiations with the EU. In particular, the Prime Minister stated that the UK would leave the single market, but would also seek to negotiate a free trade agreement with the EU. She also indicated a willingness to negotiate with other trade partners.
In its recent bulletin “Changing the Terms of Trade” Frontier (Europe) presented its own research into trade policy options for the UK in a post Brexit world. The research underscored the value of maintaining a deep level of integration with the EU. It also examined the impacts of leaving the single market, while negotiating a free trade agreement with the EU, and with other trade partners. Frontier concluded that this could represent an intermediate strategy that was neither a hard Brexit nor a maintaining of the status quo. The bulletin emphasised that for this approach to be viable, it would require that a number of economic and political factors to align. Amongst other things, it would require that the UK and the EU agree to commitments in services trade and on the movement of labour at a much deeper level than in any existing free trade agreement. And if the UK seeks to negotiate free trade agreements with other trade partners, the UK and EU would need to negotiate rules of origin, and do so in a manner that minimises disruption to cross-border supply chains.
Frontier (Europe) regularly advises clients in international trade and regulation.
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