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Boris Johnson ready to settle for an Australia-style deal, as talks reach an impasse

EU Reporter Correspondent

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Here is the statement from UK Prime Minister Boris Johnson in full.

"From the outset we were totally clear that we wanted nothing more complicated than a Canada-style relationship based on friendship and free trade. To judge by the latest EU summit in Brussels, that won’t work for our EU partners. They want the continued ability to control our legislative freedom, our fisheries, in a way that is completely unacceptable to an independent country. And since we have only 10 weeks until the end of the transition period on 1 January, I have to make a judgement about the likely outcome and to get us all ready.

"And given that they have refused to negotiate seriously for much of the last few months and given that this summit appears explicitly to rule out a Canada-style deal, I’ve concluded that we should get ready for 1 January with arrangements that are more like Australia’s, based on simple principles of global free trade. And we can do it because we always knew that there would be change on 1 January whatever type of relationship we had. And so now is the time for our businesses to get ready and for our hauliers to get ready, for travellers to get ready.

"And, of course, we’re willing to discuss the practicalities with our friends where a lot of progress has already been made, by the way on such issues as social security and aviation, nuclear cooperation, and so on. But, for whatever reason, it’s clear from the summit that after 45 years of membership, they are not willing, unless there’s some fundamental change of approach, to offer this country, the same terms as Canada.

"And so with high hearts and with complete confidence, we will prepare to embrace the alternative and we will prosper mightily as an independent free trading nation controlling our own borders, our fisheries and setting our own laws. And in the meantime, the government will, of course, be focusing on tackling COVID and building that better so that 2021 is a year of recovery and renewal."

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Shake off your ill will, Britain tells EU over post-Brexit trade

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The European Union should shake off its ill will and build a good relationship with Britain as sovereign equals, Britain’s top EU adviser David Frost (pictured, left) said on Sunday (7 March), promising to stand up for the country’s interests, writes Elizabeth Piper.

Writing in the Sunday Telegraph, Frost again defended Britain’s unilateral move to smooth post-Brexit trade between Britain and Northern Ireland, over which the EU has promised to launch legal action for breaching the terms of the Brexit deal.

Since Britain left the EU last year, relations between the two have soured, with both sides accusing the other of acting in bad faith in relation to part of their trade agreement that covers goods movements to Northern Ireland.

Frost, who led Britain’s negotiations to secure a trade deal with the bloc, was appointed as a minister and Prime Minister Boris Johnson’s main point man for future ties with the EU earlier this year and looks set to take a firmer approach.

“I hope they will shake off any remaining ill will towards us for leaving, and instead build a friendly relationship, between sovereign equals,” he wrote in an opinion piece.

“That is what I will be working towards, acting constructively when we can, standing up for our interests when we must – as a sovereign country in full control of our own destiny.”

He again defended the British government’s extension of a grace period for checks on some food products imported by retailers to Northern Ireland as being “lawful and consistent with the progressive and good faith implementation” of part of the post-Brexit trade deal called the Northern Ireland protocol.

But he added: “Without this threat of disruption, we can continue our discussions with the EU to resolve difficulties arising from the protocol constructively – and we aim to do so.”

Northern Ireland’s future was bitterly contested during the Brexit negotiations. London ultimately agreed to leave the British-ruled province aligned to the EU’s single market for goods to avoid a hard border between Northern Ireland and EU member Ireland, fearing it could be detrimental to the 1998 peace agreement that ended decades of conflict in the province.

This has required checks on some items arriving in Northern Ireland from elsewhere in the United Kingdom, which some businesses say has made it difficult to bring in supplies. To address that issue, the British government extended the grace period for some checks until 1 October.

The EU disputes that the grace period extension was in line with the agreement, saying London should honour what it signed up to. It has promised to launch legal action, or a so-called “infringement procedure” against Britain.

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Fishing firms could go bust over Brexit, MPs told

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British fishing businesses could go bust or move to Europe because of post-Brexit trading disruption, industry figures have warned, writes the BBC.

MPs were told paperwork due to new border controls had proved a "massive problem" and should be moved online.

They also heard extra costs had made it "impossible" for some firms to trade profitably.

Ministers have promised action on disruption, and £23 million for affected firms.

The UK government has also set up a taskforce aiming to resolve problems faced by the industry in Scotland.

The Commons environment committee heard funding could have to continue, and be widened further, to help the sector weather Brexit-related problems.

Outside the EU's single market, British fish exports to Europe are now subject to new customs and veterinary checks which have caused problems at the border.

Martyn Youell, a manager at south-west England fishing company Waterdance, told MPs the industry was facing more than just "teething problems".

"Whilst some things have settled down, some obvious issues, we feel that we remain with at least 80% of the trading difficulties that have been encountered," he said.

"There are some extreme forces operating on the supply chain, and we probably will see some forced consolidation or business failure."

"The exporters we deal with are seriously considering relocating part of their processing business to the EU because of the difficulties we face".

He said the "largely paper-based" forms they now have to fill in had pushed up costs, and called for the UK to work with the EU in moving them online.

'Lot of anger'

Donna Fordyce, chief executive of Seafood Scotland, said the problems could lead to smaller firms in particular stopping trading with Europe in the medium term.

She said the annual costs of the new paperwork, between £250,000 and £500,000 per year, were too much for them to sustain.

But she said many "can't see where they could turn" at the moment because travel bans and the Covid pandemic have closed off other markets.

She added there was "a lot of anger" about the design of the government's £23m compensation scheme, which links funds to provable losses due to Brexit.

She said it meant many firms which had "worked through the night" to get shipments ready had not been compensated for extra costs.

Shellfish ban

Sarah Horsfall, co-chief executive at the Shellfish Association of Great Britain, also criticised the scheme, noting firms that "made massive efforts" didn't qualify.

She also called for ministers to adopt a different approach to persuade the EU to overturn a ban on British exports of some types of live shellfish.

After leaving the EU single market, these exports from all but the highest-grade fishing grounds have to be purified before they can enter the EU market.

The UK government has accused the EU of reneging on a previous commitment such exports could continue with a special certificate.

Ms Horsfall said there had been the "propensity for a bit of a misunderstanding" among either UK or EU officials about the post-Brexit rules.

She urged a "more nuanced approach" from UK ministers in resolving the matter, noting their "bullish" response "perhaps hasn't helped either".

And she said a more "flexible" regime for determining the quality of British fishing waters could provide help to the industry in the long-term.

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EU auditors highlight risks of Brexit Adjustment Reserve

EU Reporter Correspondent

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In an opinion published today (1 March), the European Court of Auditors (ECA) raises some concerns over the recent proposal for a Brexit Adjustment Reserve (BAR). This €5 billion fund is a solidarity tool which is intended to support those member states, regions and sectors worst affected by the UK’s withdrawal from the EU. According to the auditors, while the proposal provides flexibility for member states, the design of the reserve creates a number of uncertainties and risks.

The European Commission proposes that 80% of the fund (€4bn) should be granted to member states in the form of pre-financing following the BAR’s adoption. Member states would be allocated their share of pre-financing on the basis of the estimated impact on their economies, taking into account two factors: trade with the UK and fish caught in the UK exclusive economic zone. Applying this allocation method, Ireland would become the main beneficiary of prefinancing, with nearly a quarter (€991 million) of the envelope, followed by the Netherlands (€714m), Germany (€429m), France (€396m) and Belgium (€305m).

“The BAR is an important funding initiative which aims to help mitigate the negative impact of Brexit on the EU member states’ economies,” said Tony Murphy, the member of the European Court of Auditors responsible for the opinion. “We consider that the flexibility provided by the BAR should not create uncertainty for member states.”

Opinion No 1/2021 concerning the proposal for a Regulation of the European Parliament and of the Council establishing the Brexit Adjustment Reserve

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