The UK and Canada have agreed to continue trading on the same terms as the current EU deal after the Brexit transition period ends.
The Conservative government said the deal paved the way for negotiations to begin next year on a comprehensive new deal with Canada, which has long been heralded as one of the benefits of the UK’s exit from the EU.
The Labor Party urged the government to secure continuity agreements with other key trading partners before the end of the year.
Boris Johnson and his Canadian counterpart, Justin Trudeau, made the “agreement in principle” in a video call on Saturday, the Department of International Trade (DIT) said.
Johnson said work will begin early next year to negotiate “a new customized trade agreement with Canada that will go even further in meeting the needs of our economy.”
The agreement effectively renews the Comprehensive Economic and Trade Agreement reached by the EU and Canada after seven years of negotiations. Prior to its formal signature, the UK-Canada Business Continuity Agreement will be subject to final legal scrutiny.
Welcoming the deal, Trudeau suggested that a new comprehensive trade deal with the UK would take several years to negotiate.
Speaking during the video call, which also included international trade secretary Liz Truss and her counterpart Mary Ng, Trudeau said it meant that “now we can continue to work on a bespoke agreement, a comprehensive agreement for years to come that we really maximize. our business opportunities and drives things for everyone. “
The shadow secretary for international trade, Emily Thornberry, welcomed the “necessary” continuity agreement but called for the same urgency.
“It is now vital that Boris Johnson and Liz Truss show the same urgency to secure the other 14 outstanding continuity agreements with countries such as Mexico, Ghana and Singapore, where a total of £ 60bn of UK trade is still at risk, and time is starting to run away, “he said.
Industry groups expressed relief that companies will not face higher trade tariffs with Canada next month, but British Chambers of Commerce Director General Adam Marshall echoed the Labor Party, warning that similar deals were needed with urgency to avoid “a harmful cliff edge for both importers and exporters.”
He reiterated his call for an agreement to be reached with the EU, describing it as the “most important trade agreement that our business communities need.”
Small Business Federation President Mike Cherry said: “There was always the danger that the end of the transition period would mean losing the greater access to the international market that we enjoy as part of EU membership.
“The fact that this new agreement defends the small business chapter that was previously in place is very welcome. We hope that these chapters will be at the center of all future UK trade deals. “
A trade and security deal between the EU and the UK is nearing completion, but the risk of an accidental no-deal Brexit remains in six weeks, with gaps in contentious issues “slowly narrowing,” they said. the ambassadors of the EU.
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