‘No Deal’ Outcome Would Have Been ‘Disaster’ For Companies and Consumers
This article was originally published in Global Trade Magazine on Dec. 14, 2017
By Philip Sutter, Director of Strategic Analysis in the Global Trade Management
Amid waves of negative news reports that Brexit talks were headed for a hard “no deal”, the European Commission made a significant announcement last week. The commission now recommends to the European Council that “sufficient progress” has been achieved in the first phase of talks to negotiate the terms of the United Kingdom’s exit from the European Union.
Finally, there is a glimmer of certainty that the two sides will achieve a timely overall agreement which is so critical to the interests of concerned stakeholders, but especially for European traders and multinationals.
That glimmer of hope was likely welcomed by US business interests, who have substantial investments in US-UK trade. In fact, according to recent testimony by the US Chamber of Commerce to the House Foreign Affairs Committee’s Subcommittee on Europe, Eurasia, and Emerging Threats, two-way trade between the US and UK amounts to more than $235 billion annually and 2.5 million US jobs depend on US-UK trade. That testimony described a “no deal” outcome of the Brexit talks as “a disaster for US companies” and also noted the adverse impact it would have on British consumers in terms of price increases.
According to the EU provisions under Article 50, there must first be sufficient progress declared prior to further negotiations regarding a future arrangement between the EU and UK. The European Council will take the official vote on 15-December, but are fully expected to follow the recommendation of the Commission.