The U.K. has one of the largest economies in the world. However, a no-deal Brexit has the potential to cause serious problems for local as well as foreign companies. According to the European Commission, President Ursula von der Leyen, talks will be extended beyond Sunday’s deadline. It is worth noting that, she spoke with British Prime Minister Boris Johnson via telephone on Sunday before releasing a joint statement.
People should take into account that, no new deadline was set for the discussions by the European Union and U.K. leaders. As a reminder, the U.K. left the European Union in January. However, it agreed to keep the same standards and regulations until the end of the year, so both sides would have time to develop new trading arrangements.
It is worth mentioning that, the transition period ends in less than three weeks. Moreover, there are serious concerns that they will not have a new agreement ready by that period of time. Importantly, failure to get an agreement in the coming weeks, a so-called no-deal Brexit, could create serious challenges for exporters on both sides.
People should take into account that, the Brexit negotiations are particularly difficult because it’s the first time in the European Union’s history that both sides are looking to diverge from a current set of rules. Usually, new trade agreements result in a harmonization of food, labor, as well as other standards.
Brexit and main topics
Interestingly, the British Prime Minister had a working dinner with European Commission President Ursula von der Leyen several days ago. There are three outstanding issues in the trade talks: fisheries, competition rules, as well as arbitration regarding their potential new deal. Unfortunately, negotiators failed to reach an agreement about the topics mentioned above since summer.
Hopefully, leaders stressed the urgency of the 11th-hour talks and the significance of reaching a deal of some sort. In spite of the fact that all previous negotiations failed to reach tangible progress, leaders understand the importance of the deal.
People should take into consideration that, a no-deal Brexit is a serious problem. Leaders should work harder to avoid this risk. As a reminder, a no-deal Brexit could push up taxes as well as costs for exporters on both sides. The coronavirus pandemic created a lot of challenges, and there is no need to create additional problems. Leaders should find the best solution in the coming weeks.