Tagged: agreement

UK and EU reached a Brexit deal

According to EU procedures, the “EU-UK Trade and Cooperation Agreement” will then be reviewed by the European Council and the European Parliament. However, since the EU and Britain reached an agreement at the last minute, it is almost impossible for the European Council and the European Parliament to reach an agreement next year. The review was completed before January 1, and the European Commission stated in the announcement that “based on special circumstances”, it recommended that this agreement be implemented temporarily from January 1 to February 28 next year to ensure that the UK will not face a no-deal Brexit dilemma.


The conclusion of this agreement is expected by the market. In fact, for the United Kingdom and the European Union, which are deeply mired in the “new crown crisis”, having an agreement to leave the European Union has become the best option, and it can even be said to be the “only” option, because both sides are fragile. The economy of China has been unable to bear the “worse worse”. The latest World Economic Outlook report released by the Organization for Economic Cooperation and Development (OECD) in December shows that in 2020, the UK’s gross domestic product (GDP) will decline by 11.2%, and it is expected to become one of the countries with the largest decline in global GDP this year. According to the report, by the end of 2021, the size of the British economy will shrink by more than 6% compared to before the new crown pneumonia epidemic.

The EU faces the same dilemma. The measures taken to contain the epidemic have led to a severe economic downturn in the Eurozone in November, and the possibility of GDP contraction in the fourth quarter has increased. The International Monetary Fund (IMF) warned that unless there is a “significant change in the trend of the new crown epidemic” in Europe in the coming months, economic growth in the euro zone will be weaker than previously expected. In the World Economic Outlook released by the IMF in October, the Eurozone GDP would shrink by 8.3% in 2020.

Right now, Brexit has been settled, and how to restore the economy in the “post-epidemic period” has become a new challenge for both sides. As European Commission President Von der Lein said at a press conference: “Brexit has become history, and we need to look forward.”

Britain is about to end its transition period of brexit at the end of this year

The latest round of talks between the UK and the EU is considered likely to be the last.
Over the weekend, dozens of road signs along the south-east Kent border in England were changed from “welcome to England garden Kent” to “England toilet”. After the police announced the investigation, a British anti brexit protest group claimed responsibility.
Britain is about to end its transition period of brexit at the end of this year. There are concerns that if the UK leaves the EU’s trade and customs areas without reaching a trade agreement with the EU, the customs inspection at the border from January 1 next year will cause great confusion. During a border control test in Dover last week, cars lined up for five miles on the road connecting the French ferry and the European tunnel train, and some disgruntled even hung bags of excrement onto roadside branches.
Michel Barnier, the EU’s chief negotiator, was forced into quarantine after his team members tested positive for a new crown. He was not able to leave for London until the evening of November 27 and resume face-to-face talks on the 28th.
The latest round of talks between the UK and the EU is considered likely to be the last. EU leaders are scheduled to hold a summit on December 10, and the European Parliament will hold a special meeting on December 28 to vote on the negotiation agreement. However, if the two sides can not reach an agreement on Wednesday, it will be difficult to complete the relevant review and paperwork before the end of this year.
On November 30, Josh Hardie, deputy director general of the British Federation of industries (CBI), representing about 190000 manufacturing enterprises, urged politicians to bridge their differences. He said that the new crown disease has deprived enterprises of flexibility to survive, and the prospect of the end of the transition period of brexit has caused losses. The business community urgently needs to reach the stability provided by the brexit agreement.
Success or failure in this week
Since both sides of the negotiation want to force the other side to make concessions beyond their actual ability or willingness, the brexit talks have been stuck on a few issues for a year and have always been deadlocked.
British Foreign Secretary Dominic Raab said on November 29th that talks between the UK and the EU are now in the final week and that a breakthrough is expected by Friday. But the prime minister’s office warned that the possibility of Britain leaving the EU without an agreement was “underestimated”.
The negotiations are still intertwined with two differences that existed from the beginning: one is the access level of European fishing fleet in British waters, which only involves annual total income of more than 600 million euros (1.2073, 0.0003, 2) fair competition clause. The EU wants to ensure that neither side can lower the standard or over subsidize in order to make its companies more competitive in the market.
On the issue of fishery access, Barnier’s latest concession is that the European Union can accept to reduce its share of fishing rights in British waters from the current level by 15% – 18%, equivalent to 120 million euro income. However, British officials immediately rejected the proposal, saying that the so-called concession is “ridiculous”. The EU should fully know that the British side will never accept this number.
As for the second question, in the tug of war between the two sides, the UK has agreed not to abandon the EU’s environmental, social and labour standards at the end of the transition period. However, the EU wants more and hopes that the UK will continue to follow up with the gradual improvement of relevant standards in Brussels in the future.
But the British don’t want to be bound by the rules of Brussels after brexit. The British negotiating team has repeatedly stressed that it will not “sell” British sovereignty to reach an agreement, demanding that the EU side must adopt new thinking.
However, Cl é ment Beaune, French Minister for European affairs and close ally of President Marcon, called out his compatriot Barnier from the air, saying that the EU side must remain firm and “it must not be intimidated”. Although the negotiations are difficult, it should be kept in mind that “there are more Britons than we need”.
However, the expectation given by European Commission President van der lain to Barnier is to try his best to mediate an agreement. Von der lain specially sent one of her senior officials, Stephanie Riso, to help banier break the deadlock.
Lord frost, the British negotiator, said that although it was indeed very late, he believed that there was still a chance to reach an agreement, and he vowed to continue the dialogue until it was clear that no agreement could be reached between the two sides, and that the EU “must fully respect British sovereignty”.
The Johnson administration once again stressed that if the EU does not give in, Britain is ready to end the transition period of brexit without an agreement.
Enterprises are still looking forward to the final breakthrough
In this protracted and little progress negotiation, the position of the British government has become more and more tough, but the British business community is not in line with the government.
Hardy complained that the arrival of the deadline for the transition period for brexit has caused greater losses to the business community in addition to the impact of the new crown epidemic, leading to a reduction in cash reserves. From the first day of next year, the threat of supply chain disruption looms over all cross-border sales companies, regardless of size.
Automakers, including Volkswagen and Honda, are now scrambling to stock up on auto parts and try to move more cars and parts by the deadline before the end of the transition period to ensure that companies will not be hit by sudden tariffs if the UK and EU fail to reach a trade agreement.
From January 1st next year, trade between the UK and the EU will be subject to new trade rules, and it is not optimistic that if tariffs are eventually imposed under the WTO system, the price of British imported cars will immediately rise by 10%.
The association of British automobile manufacturers and traders notes that 60% of its member companies are investing heavily in inventory, and more than 50% of its member companies employ customs agents to prepare new customs clearance paperwork.
The Association estimates that the UK auto industry alone will spend more than 235 million pounds (1.3417, 0.0000, 0.00%) on the preparation for brexit in 2020. However, compared with the Levy of tariffs, the cost is still dwarfed.
The tariff will immediately increase the average cost of imported cars by 1900 pounds per vehicle, so some car dealers are also busy importing more car stocks from Europe by the deadline.
Michael Woodward, head of the British auto sector at Deloitte, a consultancy, points out that the challenge for companies is to predict what is the right inventory. Mistakes in inventory reserves can also be costly. The impact of the new epidemic on consumer behavior and car sales makes it increasingly difficult to predict short-term market demand.
For London’s financial industry, which is suffering from the new crown epidemic, the prospect is also worrying. The Paris based EU Securities and market regulator has made it clear that after the UK’s complete brexit, European banks operating in the UK still need to be regulated by EU regulations when they operate financial derivatives business. This will directly threaten the city’s 50 trillion Euro annual derivatives business.
The office of budget responsibility (OBR) said last week that without a trade deal with the European Union, the UK economy would first suffer a direct 2% blow, the GDP losses would continue and the government would need to borrow an additional 10 billion pounds to make up the hole. OBR said the pain of brexit would seriously hit different sectors of the UK economy, roughly equivalent to the loss of the new crown pandemic in the long run.
After brexit, how would ordinary people vote with their feet? The figures recently released by the home office are somewhat unexpected.
EU citizens living in the UK are required to apply for the right to continue to live and work in the UK by 30 June next year.
Official demographics for June 2019 show that a total of 3.4 million EU, EEA and Swiss citizens live in the UK.
Interestingly, according to the latest statistics released by the Ministry of the interior, as of October 31, this year, a total of 4.26 million EU citizens’ applications for studying in the UK had been received, nearly 1 million more than originally expected.