After the UK voted to leave the EU, the country faces the prospect of having to establish new trade relationships – both with the remaining 27 EU members and other countries around the world. As a member of the EU, the UK has been included in trade deals the EU has negotiated. There are 22 trade agreements between the EU and individual countries, and five multi-lateral agreements covering multiple countries. This means that if the UK wants to retain preferential access to the markets of the 52 countries covered by these agreements, it would have to renegotiate trade deals with all of them. GETTY IMAGES News Sport Weather iPlayer TV Radio CBBC Britain is a large market, so there is a clear incentive for other countries to negotiate a deal. Advocates of Brexit argued that it would be in nobody’s interest to interrupt the current trading partnerships. But which of the other models discussed as potential post-Brexit options for the UK are realistic?
1. The Norway model Member of European Economic Area, full access to single market, obliged to make a financial contribution and accept majority of EU laws, free movement applies as it does in the EU.
2. The Switzerland model Member of the European Free Trade Association but not the EEA, access to EU market governed by series of bilateral agreements, covers some but not all areas of trade, also makes a financial contribution but smaller than Norway’s, doesn’t have a general duty to apply EU laws but does have to implement some EU regulations to enable trade, free movement applies.
3. The Turkey model Customs union with the EU, meaning no tariffs or quotas on industrial goods exported to EU countries, has to apply EU’s external tariff on goods imported from outside the EU.
4. The Canada option Ceta free trade deal with the EU has yet to come into force, gets rid of most tariffs on goods, but excludes some food items and services, and stipulates need to prove where goods are made.
5. The Singapore and Hong Kong approach City states do not impose import or export tariffs at all – a unilateral free trade approach.
The default: World Trade Organisation rules WTO sets rules for international trade that apply to all members, no free movement or financial contribution, no obligation to apply EU laws although traded goods would still have AFP to meet EU standards, some tariffs would be in place on trade with the EU, trade in services would be restricted.