Brexit: barriers to trade deal remain as talks enter final stages

Negotiations have resumed ahead of call between prime minister Boris Johnson and European Commission president Ursula von der Leyen later
Boris Johnson and Ursula von der Leyen meeting last year. Photo: PA

By Alain Tolhurst

07 Dec 2020

The prospects of the UK agreeing a  trade deal with the European Union remains in the balance a two longstanding sticking points stubbornly remain unsolved.

Access to UK fishing waters and the so-called “level playing field” on regulatory decisions have for months been a barrier to a long-term agreement with the EU, and time is very nearly out on the negotiations.

On Saturday the two sides released a statement following a call between Boris Johnson and European Commission president Ursula von der Leyen, which said “a further effort should be undertaken by our negotiating teams” to see if the outstanding disagreements “can be resolved”.

The hour-long conversation followed a decision by the UK’s chief negotiator David Frost and his EU counterpart Michel Barnier on Friday to pause the talks after several marathon sessions in London failed to end in breakthrough.

The PM and von der Leyen have another call scheduled for Monday to see if progress has been made, and leaders of the remaining 27 EU countries are due to meet for a summit in Brussels on Thursday where a final decision is expected to be taken.

A UK source close to the negotiations described it as “the final throw of the dice”, and it seems there are just four days left to solve the twin problems which stand in the way of a deal being signed before the end of the transition period on 31 December.

But the issue is that they are both are as political as they are economical.

Johnson has long said that taking back complete control of fisheries is key to the UK regaining its sovereignty as an independent coastal nation.

Meanwhile the EU has steadfastly stuck to the position that retaining access to its internal market must be on its terms, and they will not budge on their preferred mechanism for solving disputes.

Although fishing represents a very small part of the economy, it has often been described as totemic to the whole Brexit project, while EU countries - most notably France - want their boats to still have access to UK waters in the years to come.

The row essentially comes down to how much share of the quota of stocks that can be fished each side gets to keep, and for how long.

Brussels has offered Britain the chance to keep 18% of the total value of stocks, but the UK has said it wants 80%, highlighting just how far apart both sides still are.

There were suggestions Frost had lowered his demand to 60% this week, but any hope of an agreement appeared to be dashed after reports of new red lines from the EU side.

It is understood Barnier came under pressure from French president Emmanuel Macron at the head of a group of countries which feared he was giving too much ground to the UK.

But environment secretary George Eustice accused the EU of making "ludicrous" demands insisting on access to British waters for its fishermen "in perpetuity".

"The EU have suggested a very modest increase that they would tolerate the UK having of the fish in its own waters, but given that we only have half of the fish in our own waters now that simply wouldn't be possible," he told Sky News's Sophy Ridge On Sunday programme.

And on the “level playing field” the UK is also calling foul over what sources around the table have described as "unprecedented and last-minute demands”, binding it to maintaining standards with the EU forever. EU sources, for their part, have strongly denied that any of the demands are new.

At the most basic level this is about what Britain must agree to on things like workers' rights, the environment and state aid in return for trade with the single market.

Brussels has long feared a low-regulation economic rival on its doorstep, and has sought a high level of alignment, but the UK believes Brexit was about being able to set its own rules.

Johnson has called for a zero-tariff, zero-quota deal, but also the right to diverge from the bloc’s rules and regulations in the future.

The EU has said given how closely integrated the UK is with European markets it must agree stricter level playing field rules than other countries like it has signed deals with like Canada.

Without an agreement both sides will see tariffs slapped on goods sold between them, and hefty barriers placed upon trade.

In a further complicating factor, the Internal Market Bill is due back in the House of Commons on Monday and will renew the row over whether the government plans to breach international law by overriding elements of the Brexit "divorce" settlement.

After the Lords amended the legislation MPs will have to vote to re-insert the controversial clauses relating to the Irish border.

And a new taxation bill will also be introduced to Parliament this week which contains similar provisions, and is likely to harden EU attitudes towards an agreement, rather than soften its stance in the last crucial few days.

Alain Tolhurst is chief reporter at CSW's sister title PoliticsHome, where a version of this story first appeared

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