Brexit Leaves the UK and EU Locked in Trade Negotiations

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newcivilengineer.com

On Jan. 31, 2020, Britain officially left the European Union

Caiden Bertsch, Insider Staff

After years of waiting, the United Kingdom has officially left the European Union , but now both must negotiate a new trade deal.

The United Kingdom officially left the European Union on Jan. 31, 2020. The initial vote took place in June 2016, with 52% voting to leave and 48% voting to stay. The UK government formally announced the country’s withdrawal from the EU in March 2017. The move has been dubbed Brexit.

However, withdrawal from the EU was delayed due to deadlock in the British Parliament. Following a general election, Parliament finally ratified the withdrawal agreement. The UK will go through a transition period that will end on Dec. 31, 2020.

The UK and EU must negotiate a new trade deal before this deadline or Britain may face new tariffs and quotas. The EU wishes for the UK to stick with the current free trade deal. British Prime Minister Boris Johnson made it clear that he does not intend to follow the EU’s rules and regulations.

“There is no need for a free trade agreement to involve accepting EU rules on competition policy, subsidies, social protection, the environment, or anything similar any more than the EU should be obliged to accept UK rules,” Johnson said during a speech in London.

The UK and EU are at odds of how to interpret the treaty that declares both sides must ensure “open and fair competition, encompassing robust commitments to ensure a level playing field” and “these commitments should prevent distortions of trade and unfair competitive advantages,” per the agreement.

The British pound fell 1% behind the US dollar and the euro after it was clear that both sides disagree on what the treaty means. Traders are worried about the effects on the UK’s economy if they fail to reach a deal with the EU. Experts are worried that the UK and EU will not reach a comprehensive trade deal by the end of the year because most of these kinds of deals take years to negotiate.

More clashes over other topics such as environmental regulations and safety are likely to occur during the transition period.