“The clock is no longer ticking.” Those were the words of Michel Barnier, the EU’s chief negotiator, as he announced, more than 4 years after the Brexit referendum, an historic withdrawal agreement, reached at the final hour. Mr Johnson’s government was able to breathe a sigh of relief; the dreaded no-deal Brexit that would have meant the imposition of tariffs and quotas on goods traded with the EU after 31 December was avoided.
Mr Johnson was able to jovially announce that Britain would finally claim back its national sovereignty, yanking the reins away from Brussels. But is this agreement really a cause for celebration? Is it truly the start of a new era of prosperous sovereignty for Britain, or are we stumbling into a new era of isolation, thanks to a half-baked agreement, ‘achieved’ after 9 months of rushed negotiations?
Over the last week, footage of lorries queueing in Kent have swamped the media. This disruption was caused by countries closing their borders to Britain, after the discovery of a new strain of Covid-19 in London sparked waves of panic. France grudgingly re-opened its borders after 48 hours, closely followed by many of its European partners, but all with significant restrictions. This disruption in Kent, albeit temporary, gives a flavour of what would have happened, even more severely, had a Brexit agreement not been reached in time.
Some disruptions in the movement of goods are still likely to occur, however, despite the achievement of a deal. Britain has avoided the dreaded no-deal, but has negotiated a very hard Brexit, that even the most hard-line Brexiteer would not have dared dream of a few years ago. Whilst allowing Mr Johnson to parrot the claim that the UK has entirely reclaimed its sovereignty, this hard Brexit creates some considerable logistical problems for businesses.
Mr Johnson claimed “no non-tariff barriers” for trade with the EU. This is highly questionable, when the government already has numerous websites, urgently warning businesses to prepare for new rules of origin checks and conformity assessments, to give but a few examples. Retailers have called this agreement the “biggest imposition of red tape in 50 years”, as they will inevitably face many new complications in trade with the EU. Whether Mr Johnson’s government is able to successfully counteract this inconvenience by vastly increasing Britain’s possibility for trade with non-EU countries remains to be seen.
Britain has avoided the dreaded no-deal, but has negotiated a very hard Brexit, that even the most hard-line Brexiteer would not have dared dream of a few years ago.
A less acknowledged but very major stumbling block that lies ahead is the lack of provision for services in the agreement. The UK is a largely service-based economy, with its vital financial service hub based in London. Companies that export services will lose all access to the EU single market worth £100bn to them last year, and must wait impatiently for the EU to decide what access they are to have in future. UK companies also await a decision on what data protection rules will apply to companies handling EU data, whilst UK security services brace themselves for the loss of automatic access to key EU databases, used almost every day by the police.
It is blatant from this that not all decisions have been made, and talks about the future relationship are by no means over. Whilst the striking of a deal at the final hour is a huge political win for Mr Johnson, he must now rise to the economic challenge that is rearing its head as a result of this unprecedented situation. He must respond nimbly to the difficulties already outlined, to prevent a situation where businesses struggle to find their feet and trade internationally. If he is successful, we can look towards a future of friendly cooperation with our European neighbours. If he fails, we risk becoming increasingly isolated.
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