Liam Fox, the Swiss Minister of Economy Guy Parmelin and the Liechtenstein Minister of Foreign Affairs shake handsCopyright of the image
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Legend

The agreement between the United Kingdom and Switzerland, signed in Berne on February 11, also applies to neighboring Liechtenstein

As a member of the European Union, the United Kingdom is automatically part of some 40 EU trade agreements with more than 70 countries.

If the UK left the EU without an agreement on March 29, it would immediately lose these trade agreements.

To avoid this, the British government has stated that it wants to replicate the EU's trade agreements "as far as possible" and prepare them to go forward in the event of A Brexit without agreement.

Liam Fox, Secretary of International Trade, told MPs last January that the government wanted to achieve "continuity and stability" by ensuring that the United Kingdom continues to benefit from these arrangements.

So, how much progress has been made?

Four out of 40

To date, the United Kingdom has accepted only four contracts. Barry Gardiner, Secretary of International Trade for Shadow workers, said he understood that negotiations on 19 other agreements were "considerably behind schedule" and that "two are not even under negotiation".

In response, Fox said the talks to replicate the remaining deals "fail."

The 40 agreements the UK is already involved in (through its EU membership) are designed to facilitate trade between the EU and the rest of the world. These arrangements include the relaxation of certain rules, the reduction of taxes (duties) on imports and exports, or the granting of easier access to markets.

The government estimates that about 11% of UK trade is based on EU agreements with 70 countries.

The agreements that the United Kingdom has concluded are as follows:

  • Switzerland (signed on February 11)

  • Faroe Islands (1 February)

  • Eastern and Southern Africa (31 January)

  • Chile (30 January)

Swiss

Switzerland is the last to be signed. The International Trade Department said that trade between the United Kingdom and Switzerland was worth £ 32.1 billion in 2017.

Under the UK-Switzerland agreement, which was confirmed in Bern on 11 February, customs duties (goods taxes) will continue to be avoided on the vast majority of goods traded between two countries.

  • Why is Switzerland worried about British trade after Brexit?

Without this agreement, the British government has stated that the British car industry could have faced tariff charges amounting to £ 8 million, while aluminum exporters could have faced to £ 4 million.

Another agreement was also signed in Bern by Liechtenstein's Foreign Minister Aurelia Frick. He also applies the main parts of the trade agreement between Switzerland and the United Kingdom to his country.

Faroe Islands

The Faroe Islands are the 114th largest trading partner of the United Kingdom, according to the government. Total trade between the two countries was £ 236 million in 2017.

Copyright of the image
Getty Images

Legend

The UK imported more than 200 million pounds of fish from the Faroe Islands for 2017

Fish and shellfish accounted for the vast majority of British imports from the Faroe Islands in 2017, worth £ 201.7 million, while total UK exports in the country were only £ 6 million – essentially machines and mechanical devices.

The UK government has stated that the agreement it reached would mean that consumers would continue to benefit from a wider choice and a lower price of fish "such as salmon. Atlantic, haddock and halibut ".

Eastern and Southern Africa and Chile

Trade between the East and Southern Africa (ESA) region was £ 1.5 billion in 2017, representing around 0.1% of the UK's total trade. The UK-ESA agreement covers Madagascar, Mauritius, Seychelles and Zimbabwe.

Meat and fish are the main products imported from the region by the United Kingdom (£ 111 million).

Signed at the end of January, the trade agreement between the United Kingdom and Chile was the first to be concluded. Total trade between the United Kingdom and Chile was £ 1.8 billion in 2017.

Fruits, nuts and beverages are the main products imported by the United Kingdom. The government claims that this agreement will help protect parts of the UK wine industry.

Labeling of wine

The United Kingdom has also signed agreements with Australia and New Zealand, but these are "mutual recognition agreements" and not free trade agreements.

The agreement replicates all aspects of the current EU agreements on the recognition of product standards, such as wine labeling and certification.

Israel

At the World Economic Forum in Davos, Liam Fox, Secretary of International Trade, announced on Twitter that the United Kingdom had "accepted in principle" a free trade agreement with Israel. A trade conference between the two countries will be held in London in the "coming months", he added.

However, according to a government minister, it may not be possible to postpone all 40 agreements by March 29.

George Hollingbery, a Minister of the Department of International Trade, told MPs last month that some EU trade deals would be "difficult," adding that a "or two" would be "almost impossible" to have. 39 be set up by the end of the year. March.

Mr Hollingbery stressed that Turkey is a country in which it would be very difficult to reach an agreement, as it is a customs union with the EU.

The current lack of signed trade agreements is no surprise to Alan Winters, director of the UK's Trade Policy Observatory at the University of Sussex.

"You can not simply reverse everything – these existing agreements will include references to European Union law, so you can not avoid certain negotiations," he said.

According to Professor Winters, some countries may also be afraid to sign agreements at this stage, as long as it is difficult to know what Brexit will look like.

So what could be the consequences if trade agreements are not fully in place by March 29 and the UK does not leave the deal?

With countries where the UK does not have a formal trade agreement, both countries should trade under the rules overseen by the World Trade Organization (WTO).

  • Facts: What is the WTO option?

Trade would not stop if it happened, but some barriers would be removed, says Alex Stojanovic of the Institute for Government think tank.

"There is a reason why you have trade agreements, that is they give you better trade preferences than the terms of the WTO.

"Some companies will therefore be penalized by the entry into force of tariffs," he said.

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