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A joker in the pack, but still a losing hand

Just when we’d all breathed a collective sigh of relief that Brexit was finally behind us and we could get on with the day jobs, the posturing has started up again. First battleground for the trade negotiations, it seems, will be fishing, with Europe insisting that it must have access to British waters for fishing, and Number 10 adamant that the interests of British fishermen will not be sacrificed in any negotiations.

What this early tit for tat signals to me is that it’s going to pretty stormy sailing for the next 10 months, with everything to play for but nobody prepared to give any ground. France in partiuclar has warned the UK to expect a bruising battle. Both sides seem to feel they’re holding the winning hand – the one that says “they’ve got more to lose that we have.” But surely these are both losing hands if it means no eventual trade deal is struck. Europe is by far our biggest trading partner, worth a total of £642bn in 2018, almost exactly half of what we did with the rest of the world put together.

Let’s look at some of the big areas in that ‘rest of the world’ bracket where we’re doing significant trade. According to the ONS, UK exports to the US totalled in £123bn in 2018, while imports were to the tune of £78bn. Exports to China totalled £45bn, with imports of £42bn. That’s not far off the exports in Europe from the UK to France, Germany and the Netherlands.

The UK has begun negotiating trade deals, and to date has 20 deals in place covering 50 countries or territories. If that sounds encouraging, consider that they are with countries such as Kosovo, Tunisia, Lebanon, the Pacific Islands and the Faroe Islands, and represent just 8% of total UK trade. There’s a long way to go before those sorts of trade deals make any sort of dent on what we stand to lose from Europe.

So my thought is this. Most definitely there are national interests in Europe just as there are in the UK, and perhaps the posturing is just part of the game. But there are no winners if a trade deal is not struck. Perhaps once we realise that we all have far too much to lose, we can get down to the serious work of agreeing what we all so desperately need.

Mark Simms Editor

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