Trade Deals Around the World: October edition
Trade Deals Around the World is our periodic update, which gives you a quick and easy overview of what has been happening in the many trade deal negotiations worldwide.
We focus on the European Union and the United Kingdom and watch China and the United States.
The United Kingdom and the United States
The United Kingdom still hasn’t been able to agree on a trade deal with the United States. If there will be such a deal, the peace in Ireland is very important. Yahoo!News reports:
Britain and the United States will "probably end up" striking a bilateral trade deal, but agreement is "very unlikely" if the terms of the Ireland peace deal are broken, Nancy Pelosi said Friday.
"This is not said as any threat, it's a prediction, if there's destruction of the Good Friday accords, we're very unlikely to have a UK-US bilateral," the House of Representatives speaker said on a visit to London.
There will probably not be any deal soon, as President Biden has other priorities at the moment. The Guardian reports:
When Johnson was asked on Tuesday whether he still hoped to strike a free-trade agreement with the US by the time of the next general election, opening the way to lower tariffs and a closer economic relationship, he said “we’re going as fast as we can”, but declined to confirm whether it could be achieved before 2024.
The United Kingdom and Australia
The United Kingdom and Australia are still negotiating a trade agreement. Environmental groups are angry about documents that have been leaked on the new deal. Australia is refusing any reference to the UN Climate Goals in the trade agreement. The United Kingdom has more progressive stance on the climate goals than the Australian government. The Guardian reports:
The Australian prime minister, Scott Morrison, all but confirmed yesterday that Australia had asked for key Paris agreement climate commitments to be watered down in the deal. And rather damningly for the UK, just weeks before it hosts the UN climate conference Cop26 in Glasgow, it appears to have promptly obliged.
The United Kingdom and Africa
The United Kingdom’s Minister for Africa has signed a memorandum of understanding with the secretary general of the Africa Continental Free Trade Agreement (AfCFTA). Quartz reports:
Since Jan. 1 this year, the UK has fully ratified trade agreements with 14 African countries including Cameroon, Côte d’Ivoire, Egypt, and Tunisia. It also has agreements with the Eastern and Southern Africa trade bloc which includes Mauritius, Seychelles, and Zimbabwe, and with the Southern Africa Customs Union and Mozambique which includes Botswana, Eswatini, Lesotho, Mozambique, Namibia, and South Africa.
With Ghana, Kenya, and Morocco, agreements are on the road to ratification but that hasn’t prevented bilateral trade. In 2020, total trade between the UK and African countries with which it had agreements was £17.3 billion.
The United Kingdom and India, and the United Arab Emirates
The United Kingdom has started talks about free trade agreements with India and with the United Arab Emirates. Read more in these articles:
- UAE economy minister to visit Britain seeking trade deal
- UK Pursues New Free Trade Agreement with India
The United Kingdom and the European Union
The trading arrangements around Northern Ireland are causing a potential breaking point in the relations between the United Kingdom and the European Union. Bloomberg reports:
Britain's Brexit minister warned Saturday of a long-term chill in relations between the U.K. and the European Union if agreed-upon trading arrangements governing Northern Ireland are not resolved.
As well as seeking to respect the rules governing the EU's single market for goods, the regulations seek to keep an open border between Northern Ireland and EU member Ireland, a key pillar of Northern Ireland’s peace process. However, they have angered Northern Ireland’s unionist community, who say the checks amount to a border in the Irish Sea and weaken Northern Ireland's ties with the rest of the U.K.
The European Union and Australia
One might think that the cancellation of a billion euro submarine order by Australia would impact the trade negotiations between the European Union and Austrialia, but nothing is further from the truth. The Seatle Times reports:
French and Australian officials said Monday that France’s anger over a canceled submarine contract will not derail negotiations on an Australia-European Union free trade deal.
French Ambassador to Australia Jean-Pierre Thebault denied media reports that France was lobbying the European Union not to sign the trade deal with Australia that has been under negotiation since 2018.
China and CPTPP
A lot has happened with China and the CPTPP.
The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), also known as TPP11 or TPP-11, is a trade agreement among Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam. It evolved from the Trans-Pacific Partnership (TPP), which never entered into force due to the withdrawal of the United States.
The United States originally initiated the CPTPP to create a strong force to counter the influence of China. Eventually, they backed out, and the remaining countries moved forward.
China has now applied to join the very same trade pact that was designed to limit its influence, but so has Taiwan, and this has made China angry, as they see of Taiwan as a renegade province that should be part of China.
Some interesting new articles on the matter:
- China applies to join trans-Pacific trade pact to boost economic clout
- China’s bid to join Pacific Rim trade pact heaps pressure on US to step up regional economic strategy
- Taiwan’s Trade Deal Application Sets Up Showdown With China
- Taiwan Joining WTO Is Not a Precedent for CPTPP, China Says
China and the United States
The levels of import of goods from the United States by China is still not at the level that was agreed on in the trade agreement between the two countries. Yahoo!News reports:
China remained on course to be more than 30 per cent short of its 2021 commitments under the phase-one trade deal with the United States with four months left, according to the latest analysis of trade data between the world’s two largest economies.
Other Interesting Articles and News on Trade Agreements
- Taiwan urges EU to start preparations for possible trade agreement
- Cambodian parliament ratifies RCEP, world's biggest free trade pact