UK to sign biggest trade deal since Brexit vote with Switzerland

UK to sign biggest trade deal since Brexit vote with Switzerland

The British government will seek to allay concerns about the UK’s trading future as it signs a trade deal with Switzerland to prevent additional tariffs between the two countries after Brexit.

Liam Fox, trade secretary will sign the new “trade continuity agreement” in the Swiss city of Bern on Monday, saying that it will help to “deliver significant savings and help to safeguard British jobs.”

“The British vehicles sector could avoid up to £8m a year in tariff charges on their exports that would apply if the agreement wasn’t in place, while aluminium exporters could avoid up to £4m and precious stones and metals exporters could avoid up to £4m,” the trade department said.

Dr Fox is struggling to ensure that 40 existing deals that Britain enjoys through the EU with third party countries are rolled over on March 29 — when the UK is scheduled to leave the bloc.

London has failed to replicate the vast majority of third party deals, leaving businesses facing uncertainty over the terms of trade with countries such as Japan, Canada and South Korea if there is a no-deal Brexit.

If that happens then tariffs will revert to World Trade Organization terms, a prospect that alarms many companies.

The deal with Switzerland is the biggest trade agreement signed since the Brexit vote in 2016, with trade between the two countries worth more than £32bn a year in 2017.

Only a handful of other deals have been “rolled over” so far, along with new arrangements with the Faroe Islands, Chile, Israel and some countries in southern Africa.

Currently the UK has trade deals with 71 different countries through 40 agreements struck with the EU — covering 11 per cent of British trade. While Dr Fox said he has assurances from many of those countries, business groups are concerned at the slow progress in replicating some of the biggest deals.

Last month the trade secretary blamed the lack of progress on other countries refusing to believe that the UK would leave the EU without a deal.

“We’re ready and we’ve put all our proposals forward . . . a number of countries . . . are unwilling to put the preparations in for no-deal,” he claimed.

The EU has agreed that its trade deals will continue to cover the UK during the two-year Brexit transition period if the UK parliament ratifies Theresa May’s withdrawal deal, assuming the other parties do not object.

However, Brexiters’ hopes of rapidly agreeing a trade deal with the US have foundered on the Trump administration’s hostility to Mrs May’s Chequers plan, which would keep the UK tied to EU rules on goods indefinitely.

Last week the Financial Times revealed an impasse in talks between Japan and the UK, with Tokyo confident it can extract a better deal than the existing treaty.

At the same time the Department for International Trade briefed 30 business groups on its failure to replicate “most” of the trade deals in time.

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