Boris Johnson, the great Brexit-embarrassment - or the United Kingdom, the crash is imminent

The Brexit at the beginning of the year was only the first step, with the UK, the EU has left. Since then, negotiations on a free trade agreement with the Union

Boris Johnson, the great Brexit-embarrassment - or the United Kingdom, the crash is imminent

The Brexit at the beginning of the year was only the first step, with the UK, the EU has left. Since then, negotiations on a free trade agreement with the Union. Officially, the island is left until the end of this year, yet part of the EU single market, with all its advantages and disadvantages. An extension until the end of 2021 is possible and increasingly likely. As London and Brussels can not agree in essential points.

Why the need for a free trade agreement?

Previously, companies move Goods between the EU countries and the United Kingdom duty-free. Moreover, the same Standards apply on both sides, about at the time, but also, for example, in the case of the safety for workers.

For both sides, this is a lucrative business: the UK exported 2018, approximately 49 percent of its Goods and services in other EU countries, a further 11 per cent in countries with which the EU has concluded a free trade agreement. For example, Switzerland, Norway and Canada. 2019 Japan and South Korea were added.

for Germany, the island is an important trading partner: in 2019, the volume of imports and exports at about 117 billion euros. The power of great Britain to our screen twichtig trading partners.

Without a new free-trade agreements, these volumes would fall as well. Because then mutual duties would be established. The EU could also check imports from the UK more on the quality and Standards of their production and, at worst, stop.

Where both parties are in agreement?

Little discussion there is, therefore, between the UK and the EU, a new trade agreement is about to be closed. Similarly, it is also undisputed that no new tariff barriers are to be constructed. There is no reason the economies of both blocks is from the EU times is still well-matched. It is hardly to be feared, that the UK streams suddenly dumping products on the EU market.

What is the hook that the negotiations then?

points of dispute, there is, especially when it comes to the Standards of the products, the the UK in the EU wants to deliver. So far, all of which must meet the requirements set out in Brussels, as it applies to all the countries of the Union. In the short term, will change for the island.

The London-based government but would like the freedom to change in the future, such Standards. Brussels, in turn, to ensure that at least the EU Standards must also be implemented in the future. The sense of the Brexit supporters as paternalism. They wanted to eventually withdraw from the Union, in order to have no requirements from Brussels the more follow.

What the UK wants?

Prime Minister Boris Johnson has called for a Deal similar to the agreement between the EU and Canada ("CETA"). However, it is unclear whether he understood this contract really. Firstly, the negotiations on CETA, which lasted about eight years, until the Deal in 2017, was negotiated. Secondly, he's not signed today, all the EU members. And thirdly, the CETA is not a real free trade agreement. Certain products – mainly food – are mutually occupied with duties, for other products there are quotas, which are allowed to come in duty free traded every year.

Fourthly, – and this is for the UK is hugely important – contains CETA hardly any regulations for the Financial transactions between the EU and Canada, because of the plays in this trade is of little importance. For the UK, but it would be enormously important, so that London can act banks on the continent.

what now?

must Officially decide Johnson in this month, whether he requested the EU to extend the free trade status by the end of 2021. He probably won't do that because he promised his constituents that way.

On both sides, but it is considered unlikely that up to the autumn of a solution of the trade problems. The Bank of England has requested that the financial institutions in the country once before, on the "No Deal"case. The Japanese car manufacturer Nissan warned last week, it must close the plant in Sunderland in this case. The threatened thousands of jobs.

Likely, therefore, that Johnson applied for no later than autumn, but an extension, and the EU accepted it, although it comes too late. Then the whole year ahead remains similar to tough negotiations, as on the original Brexit Deal.

What are the trade agreements negotiated the UK already?

so Far, all the Deals, concluded by the EU in force for London. With the exit of the country will have to negotiate their own agreement. This is a lot of work, preceded only by the piece. While there are already 19 trade agreements with 50 different States, but covers the UK so far, only about eight percent of its trade. Among the most important partners in Switzerland (trading volume of 36.4 billion euros), South Korea (EUR 16.6 billion) and the South African countries (11.5 billion euros) so far.

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Updated Date: 08 June 2020, 13:27

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