Economy International Affairs Uncategorized

Brexit Breakthrough: Boris gets a trade deal with the EU for Christmas

After just about five years of frustration and political, economic, and social uncertainty in the United Kingdom, the people of Great Britain are finally beginning to see the light at the end of the tunnel as their country enters a whole new world. In the early hours of Christmas Eve, 2020, the UK and EU reached a trade agreement that will form the foundation of the British-European relationship for the foreseeable future.

A mere week before the deadline for a deal to be reached, this agreement brings a sensation of relief for both sides, and while both the Brits and Europeans are more exhausted than satisfied, this trade deal ensures that economic and political chaos is not what awaits in the new year. The deal that has been reached promises that goods will be able to flow between Europe and the United Kingdom free of tariffs and quotas, but still, there are many logistical and bureaucratic barriers to trade that will be levied. The main points of discussions during these drawn-out trade negotiations were regarding fair-competition guidelines, mechanisms to resolve future disputes, and fishing rights.

Even though fishing is not necessarily the most economically important industry for the UK, securing sovereignty over their borders has been a consistent driving force behind the Brexit movement. For a period of five and half years, the UK and EU will abide by a preliminary structure to their fishing activities within each other’s maritime territories, and after that period, points of interest will be reassessed. Under this new structure, EU fishing vessels will not be permitted to operate within six miles of the UK coast and of their fishing yields in British waters, a 25% quota will be handed over to the British fleet. Still, the British fishing industry finds this structure to be damaging, as they were looking to secure a twelve mile protected area around their coast as well as a more than 50% quota of EU fishing yields in their territories.  “I think there will be a lot of disappointed and frustrated fishermen across the country tonight”, said Barrie Deas, CEO of the UK National Federation of Fishermen’s Organizations.

Regarding fair-competition guidelines, the British have agreed to maintain similar standards and regulations as their European counterparts in order to maintain a relatively level playing field. Going into these negotiations, the Europeans have been wary of the fact that the Brits could very well abandon some of the European principles like environmental regulations and certain labour practices in order to undercut European production. As for future trade disputes, the UK negotiated for future resolutions to be brought by arbitration rather than automatic penalties that the EU was looking for.

Also an issue of significance for the UK is that British students will now be ineligible for the European Erasmus exchange program of study, after the two sides were unable to come to an agreement on the programme and the UK preferred to go about creating its own exchange programme.

Moving forward, the United Kingdom will be faced with both the comforts and struggles of carving out a place in this still uncertain world on its own. Already having worked out trade deals with over fifty countries, the UK is well on its way to establishing itself once again as a player on the world stage. Despite agreeing to trade deals with the EU and Canada, the Brits still face uncertainty with regards to trade with the Americans, arguably the most important influencer in global trade. As populist President Donald Trump gives way to President-elect Joe Biden, Boris Johnson will have a complex relationship to mend with Biden, especially on the trade front. Whereas Trump has been a backer of Brexit and Boris Johnson for some time now, Biden has proven to have a colder perspective on the whole affair, even declining to negotiate new trade deals until the United States can improve their competitiveness at home.

Despite all the obstacles complicating the management of the post-Brexit United Kingdom, this new trade deal with the EU has been lauded by leaders across Britain for at least avoiding what could have been a very nasty no-deal Brexit. Prime Minister Boris Johnson announced that, “For the first time since 1973, we will be an independent coastal nation with full control of our waters… We’ve taken back control of our laws and our destiny.” Still though, Johnson anticipates a bright future for the UK – EU relationship. “Although we have left the EU,” he said, “this country will remain culturally, emotionally, historically, strategically, geologically attached to Europe.”

With news of the breakthrough coming only days before its deadline, Labour Party leader, Sir Keir Starmer, has confirmed that his party will support the deal when it comes to the floor of the House of Commons before the new year.  Having said that, Starmer pledged to hold this government to account for all of its promises made and all of its promises broken, only voting for the deal up against the prospect of coming out of the EU without a deal at all.

Brexit Party leader, Nigel Farage, insisted that he is not satisfied with all aspects of the deal but did concede that, “we’ve reached a point after years of trench warfare, division and bitterness, even I have to say – let’s just mark this moment, it’s not perfect, but it’s a lot better off than we were five years ago.”

Looking beyond the struggles that have fraught UK – EU relations for last half-decade, this new trade deal opens new opportunities for the UK, albeit in a world flipped upside down by a pandemic which has hit the UK specifically hard. Even still, this marks the end of a tireless five years that have upended the British and European political, social, and economic spheres, ushering in a new era set to define each of the two societies for generations to come.

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