This week the Financial Times has reported on two sources which support the growing concern that the UK will struggle to maintain its current trade levels after leaving the EU. The first is a survey conducted by Gowling WLG, a London-based law firm, which suggests that a third of US business leaders whose companies export to the EU are concerned that their trade deals will suffer if UK-EU divorce negotiations are not swiftly resolved. Over half of those business leaders who took part in the survey also admitted that they were considering bypassing the UK completely in order to be able to conduct business directly with the European Union. To back-up these survey results, Bernardine Adkins of Gowing WLG added – “The strong UK-US trade relationship that has been carefully nurtured over the past 50 years is in serious jeopardy.” The second cause for concern is a report put together by the House of Lords which concludes that the UK will not be able to form a new legally binding relationship with the EU within two years once Article 50 has been envoked. Baroness Verma, the Conservative chair of the Lords’ subcommittee that conducted the study, said “It is unlikely that a bespoke EU trade agreement can be agreed within Article 50’s two-year period, so a transitional deal is vital for protecting UK trade and jobs that rely on trade.” It is unclear at this early stage what is meant by a “bespoke agreement” and what terms could reasonably be agreed between the UK and EU. With many months of negotiation ahead, it may be some time before we know what this entails. The government is hoping that it will be able to hold talks with Member States on future UK-EU relations at the same as withdrawal negotiations in order to make best use of the time available.
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