Two days after the announcement by the British Prime Minister, Theresa May, that the United Kingdom was planning to leave the single market and negotiate a free-trade agreement and a customs agreement with the EU after it leaves the bloc ('Brexit'), the European Commissioner for Trade, Cecilia Malmström, warned on Thursday 19 January that an EU/UK pre-trade agreement would not take priority over the 15 other trade agreements already being negotiated between the EU and third countries.
The United Kingdom will have to withdraw from all of the 38 trade agreements in force between the EU and third countries and may not start talks for a free-trade deal with the EU until it has left, Malmström explained at a round table at the World Economic Forum in Davos, several British media sources report.
"If they do leave the internal market and probably also part of the customs union, there would have to be a trade agreement between us and the UK, which will be negotiated after they have left", Malmström stressed, reiterating that a transitional agreement would have to plug the gap until a new agreement governing the permanent relationship between the EU and the UK can be concluded.
The EU's negotiator-in-chief for Brexit, Michel Barnier, and his team "have been very clear on this. They think from the moment they exit somewhere in 2019 there will be some sort of transition period", she said.
Malmström went on to warn that the UK would find itself at the back of the queue of countries negotiating free-trade agreements with the EU and that it faced an extremely tough series of negotiations after Brexit. "We are negotiating 15 or 16 trade deals at the moment, so we are busy", she said.
A headache for the WTO. The Director-General of the WTO, Roberto Azevêdo, who was also in Davos, said that it would not be as easy as people might imagine for the UK to fall back on a minimalist WTO arrangement if it leaves the EU customs union as well as the single market.
The United Kingdom can "cut and paste" certain elements of the current arrangement, but it will not necessarily be a seamless transition, Azevêdo warned.
"It is very important what the terms of the divorce are. Only once they have severed ties with the EU can the United Kingdom negotiate. The more the UK wants to do, the more complicated it is. There are tricky issues and they will have to negotiate with 163 parties", he also warned.
May wants to "embrace genuine free trade". May, who was also in Davos on Thursday, pledged that the United Kingdom would take "a new leadership role as the strongest and most forceful advocate for business, free markets and free trade anywhere in the world". "We are by instinct a great, global trading nation that seeks to trade with countries not just in Europe, but beyond Europe too (…). At the heart of [my plan] is a determination to pursue a bold and ambitious Free Trade Agreement between the UK and the European Union. But, more than that, we seek the freedom to strike new trade deals with old friends and new allies right around the world as well", she added, welcoming the fact that discussions have already started with Australia, New Zealand and India and the interest expressed by Brazil, China and the Gulf States. "It is about embracing genuine free trade, because that is the basis of our prosperity but also the best way to cement the multilateral partnerships and cooperation that help to build a better world", she concluded. (Original version in French by Emmanuel Hagry)