James Bacchus writes today that WTO trade negotiators may be eager to exploit the U.K.’s separation from the EU herd. Like a wounded animal, the U.K. could be set upon with demands for more open markets, giving advantages to nations that could never have set such terms when the U.K. was a member of the EU.
The widespread assumption is that Britain will be able to fall back automatically on the balance-of-trade rights and obligations it enjoys as a member of the World Trade Organization. In Brexit parlance, this is called the WTO option.
The problem is that 163 other WTO member countries may see things differently. This is not to cast doubt on the legal status of the U.K. as a WTO member. What is very much in doubt, however, is whether the U.K.’s current WTO trade benefits will survive intact post-Brexit.
Some legal scholars argue that the U.K. could just cut and paste its current trade obligations from the EU list, cross out “European Union” and replace it with “United Kingdom.” This argument is more likely to persuade other legal scholars than canny trade negotiators seeking greater access to British markets.
Trading countries being what they are, the other WTO members may argue that the U.K.’s current trade concessions are insufficient for a proper balance of rights and obligations outside the EU. It would only take one objecting member to veto a required consensus.
Market-hungry countries may seize this opportunity to seek concessions from the U.K. on manufacturing, agriculture, and financial and other services. The U.K. may even be asked to give more in exchange for keeping the same trade benefits it currently enjoys as a WTO member.
Read more here.
Latest posts by Dick Young (see all)
- Witness the Raw Power of Diversification - September 13, 2019
- With This Plan You Can Save More in 8 Years than in 32 Without It - September 6, 2019
- Don’t Be Shaken Out of the Market on Bad News - August 30, 2019