British Prime Minister Boris Johnson answers questions during a media conference at an EU summit in Brussels, Thursday, Oct. 17, 2019. Britain and the European Union reached a new tentative Brexit deal on Thursday, hoping to finally escape the acrimony, divisions and frustration of their three-year divorce battle. (AP Photo/Francisco Seco)

Canadian business needs Brexit certainty but Johnson plan only a start: observers

The outcome of the unusual weekend vote in London is itself far from predictable

Experts warn that a post-Brexit United Kingdom will present Canadian business with tremendous uncertainty about billions of dollars worth of trade and investments, no matter how the British Parliament votes on Saturday.

The outcome of the unusual weekend vote in London is itself far from predictable, as British Prime Minister Boris Johnson struggles to get support for a controversial agreement that he reached Thursday with the European Union.

But observers say even a Johnson success would only provide a starting point for further rounds of difficult negotiations between London and Brussels and eventually between Canada and the United Kingdom.

Fasken partner Clifford Sosnow says the primary benefit of Johnson’s plan is that it would provide for 14 months to 36 months of negotiations on a new trade deal for two of Canada’s biggest export and investment markets.

“The major concern for everybody is the instability and the instability from not knowing what the business relationship will be, what the investment relationship will be,” says Sosnow, who provides strategic advice about international trade and investments at one of Canada’s largest business law firms.

He adds that open talks between the United Kingdom and Canada would be allowed only after the U.K. leaves the European Union on Oct. 31, if Johnson’s schedule is passed by the British House of Commons.

ALSO READ: Brexit hard-liner Boris Johnson wins race to become UK’s next prime minister

The United Kingdom by itself, represents one of Canada’s top five destinations for investments and top 10 markets for goods and services.

It has also been a gateway for Canadian companies that do business in the European Union, which is Canada’s second- or third-biggest trading partner after the United States and China, depending on the measure.

About 40 per cent of Canadian trade in merchandise with the EU goes through United Kingdom, says Achim Hurrelmann, a political scientist and co-director of Carleton University’s Centre for European Studies in Ottawa.

Without a good free-trade deal between Brussels and London, companies may reconsider “whether they want to stay in the United Kingdom or … go to Dublin (Ireland), or to France or to Germany or the Netherlands.”

“To some extent, that has already happened but my impression is that most companies have been staying put and observing and waiting (to see) what is happening,” Hurrelmann says.

He says that Johnson’s proposed deal would provide more time to sort out the U.K.’s trade relationship with the EU but also with Canada.

“Canada wants to have a trade deal with the U.K. and the U.K. wants to have one with Canada as well,” Hurrelmann says.

“But the question, of course, is will we have time to actually work that out properly or will that have to be very rushed after a no-deal Brexit.”

Mark Camilleri, a Brussels-based Canadian at the Canada EU Trade and Investment Association, says he thinks it’s fair to say “that having any deal is better than having no deal” if only to reduce uncertainty.

He says that having no U.K.-EU. deal “it would potentially be very destabilizing for businesses, including Canadian businesses that are not just based in the U.K. but also based in the EU that are trading to the U.K.”

But Camilleri noted the British Parliament has rejected Theresa May’s proposals on three occasions so ’one has to hold one’s breath as to whether or not (Johnson’s deal) will get through.”

David Paddon, The Canadian Press

Like us on Facebook and follow us on Twitter.

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Comments are closed

Just Posted

Kilby Park in Harrison Mills under water

Area is often subject to flooding, Historic Site will remain open through the summer

Rain didn’t stop car enthusiasts from cruising through Hope

Classic cars, hot rods and motorcycles took part in the July 1 event

QUIZ: Put your knowledge of Canada to the test

How much do you know about our country?

Wardle St., Landstrom Road, Bristol Island and Haig Station could see high waters as heavy rain forecast

District warns of high water, seepage in these areas as emergency operations centre re-activated

UPDATE w/ VIDEO: Semi crashes through barriers east of Chilliwack on Highway 1

Emergency, Hydro crews dispatched as truck goes off the road in westbound lanes

‘This year is unlike any other’: Trudeau delivers Canada day address

Sophie Gregoire Trudeau and the Prime Minister release video celebrating the national holiday

Ottawa jail inmates argue anti-COVID measures a breach of charter rights

The prisoners allege guards did not wear masks until April 25

Epstein pal arrested, accused of luring girls for sex abuse

Ghislaine Maxwell was in an intimate relationship with Epstein for years

B.C. repairs COVID-19 emergency order for local government

Ombudsperson shut out as his recommendations implemented

More than 50,000 Coronavirus cases reported per day in US

Coronavirus cases are rising in 40 of 50 US states

Trump plans huge July 4 fireworks show despite DC’s concerns

Despite health concerns from D.C.’s mayor, no one apparently will be required to wear masks

Canadian engineer detained in Egypt released, needs treatment, family says

Yasser Albaz was detained at the Cairo airport after a business trip in February of 2019

Reports of military member arrested after truck rammed gate near Trudeau residence

Officers descended on the sprawling estate Thursday morning.

Canada Day tractor incident kills three children, injures seven in Quebec

The tractor driver has been arrested following the accident

Most Read