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UK and Canada to trade on EU terms after Brexit transition

The Guardian logo The Guardian 21/11/2020 Mattha Busby
a man holding a sign: Photograph: Francisco Seco/AP © Provided by The Guardian Photograph: Francisco Seco/AP

The UK and Canada have agreed to continue trading under the same terms as the current EU agreement after the Brexit transition period ends.

The Conservative government said the agreement paved the way for negotiations to begin next year on a new comprehensive deal with Canada, which has long been trumpeted as one of the benefits of the UK leaving the EU.

Labour urged the government to secure continuity arrangements with other key trading partners before the end of the year.

Boris Johnson and his Canadian counterpart, Justin Trudeau, made the “agreement in principle” in a video call on Saturday, the Department for International Trade (DIT) said.

Johnson said that work would begin from early next year to negotiate “a new, bespoke trade deal with Canada that will go even further in meeting the needs of our economy”.

The deal effectively rolls over the Comprehensive Economic and Trade Agreement reached by the EU and Canada after seven years of negotiations. Before it is formally signed, the UK-Canada Trade Continuity Agreement will be subject to final legal checks.

TOPSHOT - The clock face of Elizabeth Tower, known after the bell Big Ben, shows the hands at eleven o'clock as a Union Flag flies in front of it in London on January 28, 2020. - Britain will formally leave the European Union at 11pm GMT on January 31, 2020. (Photo by Justin TALLIS / AFP) (Photo by JUSTIN TALLIS/AFP via Getty Images) © Getty Images TOPSHOT - The clock face of Elizabeth Tower, known after the bell Big Ben, shows the hands at eleven o'clock as a Union Flag flies in front of it in London on January 28, 2020. - Britain will formally leave the European Union at 11pm GMT on January 31, 2020. (Photo by Justin TALLIS / AFP) (Photo by JUSTIN TALLIS/AFP via Getty Images)

Welcoming the deal, Trudeau suggested a new comprehensive trade agreement with the UK would take several years to negotiate.


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Speaking during the video call – which also included the international trade secretary, Liz Truss, and her counterpart Mary Ng – Trudeau said it meant that “now we get to continue to work on a bespoke agreement, a comprehensive agreement over the coming years that will really maximise our trade opportunities and boost things for everyone”.

The shadow international trade secretary, Emily Thornberry, welcomed the “necessary” continuity deal but called for equal urgency.

“It is now vital that Boris Johnson and Liz Truss show the same urgency in securing the other 14 outstanding continuity agreements with countries like Mexico, Ghana and Singapore, where a total of £60bn of UK trade is still at risk, and time is beginning to run out,” she said.

Industry groups expressed relief that businesses will not face higher trade tariffs with Canada next month but the British Chambers of Commerce director general, Adam Marshall, echoed Labour in warning that similar deals were urgently needed to avoid “a damaging cliff edge for both importers and exporters”.

He repeated his call for a deal to be struck with the EU, describing that as the “single most critical trade agreement our business communities need”.

LONDON, UNITED KINGDOM - NOVEMBER 11: (EMBARGOED FOR PUBLICATION IN UK NEWSPAPERS UNTIL 24 HOURS AFTER CREATE DATE AND TIME) Prime Minister Boris Johnson (seen wearing a face mask with a number 10 embroidered into it) attends a service to mark the centenary of the burial of the Unknown Warrior at Westminster Abbey on November 11, 2020 in London, England. The service is to commemorate the funeral of an unknown British serviceman, the Unknown Warrior, whose body was brought from Northern France and buried at the west end of the nave in Westminster Abbey on 11th November 1920 to represent all those who lost their lives in the First World War but whose place of death was not known, or whose bodies remained unidentified. (Photo by Max Mumby/Indigo/Getty Images/Pool) © Getty Images LONDON, UNITED KINGDOM - NOVEMBER 11: (EMBARGOED FOR PUBLICATION IN UK NEWSPAPERS UNTIL 24 HOURS AFTER CREATE DATE AND TIME) Prime Minister Boris Johnson (seen wearing a face mask with a number 10 embroidered into it) attends a service to mark the centenary of the burial of the Unknown Warrior at Westminster Abbey on November 11, 2020 in London, England. The service is to commemorate the funeral of an unknown British serviceman, the Unknown Warrior, whose body was brought from Northern France and buried at the west end of the nave in Westminster Abbey on 11th November 1920 to represent all those who lost their lives in the First World War but whose place of death was not known, or whose bodies remained unidentified. (Photo by Max Mumby/Indigo/Getty Images/Pool)

The Federation of Small Businesses chairman, Mike Cherry, said: “There was always a danger that the end of the transition period would mean losing wider international market access that we enjoyed as part of EU membership.

“The fact that this new agreement upholds the small business chapter that was previously in place is very welcome. We look forward to such chapters being at the centre of all future UK trade deals.”

An EU-UK trade and security agreement is close to being finalised but the risk remains of an accidental no-deal Brexit in six weeks, with gaps on the contentious issues “slowly shrinking”, EU ambassadors have been told.

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