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Analysis

Fox flounders on EU’s trade deals with 66 other countries

by Luke Lythgoe | 01.11.2017

Liam “the easiest deal in history” Fox needs to realise that blind optimism cannot win a successful Brexit. A grilling by the Commons’ International Trade Committee revealed not only that he is unable to guarantee deals copying over the EU’s trade agreements with other countries to the UK, but he hasn’t grasped the complexities of doing so either.

The UK currently enjoys free trade with 66 non-EU countries thanks to its membership of the EU, including South Korea, Switzerland and Mexico. Further deals with Canada and Japan will be finalised in the near future.

Labour’s Chris Leslie picked on a tweet from former trade minister Mark Price, saying all the countries “have agreed roll over” of the EU deals.

Price tweeted this after he resigned from the Department of International Trade in September. The best Fox could muster, when quizzed, was: “We’ve not had any indication from any of our trading partners in those countries that they would not want to do (roll-over agreements).” He added: “We haven’t got agreement with them. But they’ve agreed with the process.”

The government’s chief trade negotiator, Crawford Falconer, then admitted that what countries say today might not be what they’re saying tomorrow.

Fox was later pressed on whether he expected the other countries to try and renegotiate any terms of the EU deals being copied over, or indeed whether the UK wanted to do so. He said the UK didn’t and that the point of copying these deals over was the “technical replication of the conditions that exist today” so as to avoid disruption.

It became clear Fox hadn’t grasped the detail. The SNP’s Angus MacNeil, chairing the committee, gave the example of the EU’s free trade deal with South Korea, which requires manufactured goods such as cars to have 55% of their parts originate in the exporting country. If these rules of origin were kept intact for a new UK-Korea trade deal, British cars wouldn’t meet the criteria as many of their parts would come from the rest of the EU. However, South Korea’s still would. That would mean South Korea could export its cars freely into the UK, but the UK couldn’t do the same in the Korean market.

Responding to InFacts, the Department for International Trade said: “We are working with existing EU trading partners to ensure that arrangements are in place for maximum continuity of existing preferential trading agreements.”

Fox previously claimed copying these free trade deals will be “relatively easy” and 40 will be signed “the second after midnight” of Brexit day. What the country needs is hard graft not blithe optimism.

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This article has been updated following a response from the Department for International Trade.

Edited by Hugo Dixon