Leaving EU without a trade deal 'would uniquely disadvantage Britain'

Leaving EU without a trade deal 'would uniquely disadvantage Britain'

A British campaign group has urged the government to rethink its willingness to leave the European Union without some kind of trade deal in place.

Research from Open Britain has indicated that proceeding with Brexit without coming to a preferential trade agreement with the EU would leave the UK in a worse position than any other G20 nation.

Prime minister Theresa May has made it clear that she would be prepared for the country to leave the EU without a deal in place if the alternative was accepting terms with which she was unhappy. Additionally, during the Brexit referendum campaign, leading supporters of the Leave campaign suggested that defaulting to World Trade Organization (WTO) rules would be an acceptable fallback, describing this as the model favored by other leading non-EU economies, including the US.

However, Open Britain's analysis of data supplied by the House of Commons Library has shown that that the EU does not trade with any member of the G20 nations without some sort of preferential trade arrangement in place, ranging from full free trade agreements (FTAs) to smaller-scale mutual recognition and equivalence agreements, for example in financial services.

It was also noted that many countries that already have preferential agreements in place - such as Australia, New Zealand and the US - are seeking formal FTAs with the EU to improve their market access and reduce trade barriers, suggesting this could be the preferred outcome for Britain.

Pat McFadden, a Labour Party MP and a leading supporter of the Open Britain campaign, said: "This research shows that no major economy trades with the EU on the basis of WTO rules alone. All have some kind of agreement or mutual recognition process with the EU in place, even if it falls short of a fully-fledged free trade agreement.

"The government is flirting, as a negotiating tactic, with an option that poses huge dangers to UK industry, services and agriculture."