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The U.K. will need to go further than Canada in its commitments to the European Union if it wants to trade without tariffs and quotas, European Commission President Ursula von der Leyen warned, further raising the temperature with Britain before negotiations on the future relationship even start.
In a direct, personal response to the speech by Prime Minister Boris Johnson in London last week, the EU’s top official said the trading relationship she believes the U.K. is striving for is more ambitious than the regularly cited Canada model because of the “unique” level of access Britain would have to the bloc’s single market.
Johnson’s speech in Greenwich last week was “encouraging,” Von der Leyen said, but added that the prime minister needs to go further than mere “ambition” on standards in areas such as rights for workers and parents, the environment and rules on government subsidies.
“This is what we also want,” von der Leyen told the European Parliament on Tuesday in Strasbourg, France. “Let us formally agree on these objectives.”
The two sides are scheduled to start negotiating next month and are aiming to strike an agreement on their future relationship in areas including trade, security and financial services by the end of the year. If they don’t, the U.K. will be faced with the potentially damaging prospect of trading on World Trade Organization terms.
The EU insists the U.K. must stick to tough rules to prevent the country lowering standards and undercutting the European economy. Johnson said the U.K. will have the right to decide its own rules and is prepared to walk away if this is the condition for a deal.
On Tuesday, Chancellor of the Exchequer Sajid Javid said the government will break away from EU rules governing financial services, but wants to agree on a “durable” trading relationship for banks. The Treasury is drawing up a detailed plan for trade negotiations with the EU and Javid, writing in the London newspaper City A.M., insisted Britain will diverge from the bloc’s regulations.
“Our deal with Canada eliminates tariffs on a wide set of goods, but not on all,” von der Leyen said. “Our deal with Canada eliminates most quotas, but certainly not all.”
She poured scorn on describing the EU’s trading relationship with Australia as a possible model for the U.K. “The European Union does not have a trade deal with Australia -- we’re currently trading on WTO terms,” she said.
--With assistance from Tim Ross.
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