Britain’s Johnson clashes with European Union over future trade deal

The Brexit battle between the UK and the European Union resumed as British leader Boris Johnson clashed with the bloc’s chief negotiator Michel Barnier at the start of 11 months of talks on a future trade deal.

Barnier said in Brussels that a “highly ambitious” trade deal is on offer for the UK – but only if Johnson signs up to rules to prevent unfair competition. Speaking minutes later in London, Johnson rejected Barnier’s demand and insisted the UK will thrive even if negotiations fail.

He said instead the UK would be happy with a relationship based on Australia’s far looser arrangements with the EU. Australia does not have a formal trade deal with the EU and faces World Trade Organisation tariffs and barriers in many areas.

The rival speeches – which took place almost simultaneously on Monday morning – represent the first formal exchanges between the two sides in what looks certain to be a hard-edged and tense negotiation.

“The question is whether we agree a trading relationship with the EU comparable to Canada’s or more like Australia’s,” Johnson told an audience of business executives and EU ambassadors in Greenwich, East London. “I have no doubt that in either case the UK will prosper mightily.”

After three years of bad-tempered talks and last-minute breakthroughs over the U.K.’s political withdrawal, early signs indicate that the parties could struggle to avoid a cliff-edge when it comes to agreeing their future trading arrangement.

The EU’s draft negotiating mandate said the UK needs to make “robust commitments” to ensure it does not undercut the EU. On climate change, the UK is expected to maintain a system of carbon pricing and consider linking its domestic emissions market with that of the bloc.

Johnson’s government thinks that the time frame is sufficient to get a full deal, one at least as good as the deal that Canada reached with the EU. The EU’s leadership has said this will be impossible.

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“We now have to address the consequences of the choices the UK has made.” said Barnier. “Because of those choices the UK will no longer be able to benefit from the rights and advantages of the EU.”

Barnier said the “exceptional offer” is conditional on commitments to ensure a level playing field in areas such as taxation, labour rules and environmental standards.

“We need to make sure competition is and remains open and fair,” he said. Barnier said the EU isn’t looking for “alignment” of rules, but “consistency” from the UK He added that he wants “mechanisms to uphold the high standards we have.”

In his speech, Johnson insisted the UK was not leaving the EU to “undermine European standards” and promised to keep higher standards in many areas, including environmental protections. Britain will do this “without the compulsion of a treaty,” he said.

“The anxiety should really be on our side of the Channel, not yours,” Johnson told the bloc. “Look at state aid: France spends twice as much on state aid as the UK,” he said. “Who is using subsidies to undercut? Not the UK”

The Canadian deal that Johnson cited as a model removes tariffs on 98 per cent of goods trade, raises tariff-free quotas, opens up public procurement so Canadian and EU companies can bid for each other’s governments’ contracts, and protects intellectual property. The EU and Canada negotiated for seven years before signing that accord in October 2016.

One unknown factor is how much Johnson really wants an agreement with the EU. Many Brexit purists in his Conservative party would be happy without one.