Doubts cast over free trade deals immediately after Brexit


Britain may not be able to strike free trade deals with other countries until years after leaving the European Union, an International Trade Minister has suggested.

Greg Hands admitted it "remains to be seen" whether the UK can make agreements with countries such as the US immediately after Brexit, expected by March 29 2019, despite it being a key plank of Theresa May's strategy.

Brexit Secretary David Davis and Chancellor Philip Hammond, two key Cabinet voices on the issue, have said Britain will leave the single market and customs union by the exit date.

Both also agree that a transitional deal is likely to be required to avoid a "cliff edge" for businesses, with Mr Davis saying it would probably last until 2022 and Mr Hammond suggesting it could take longer.

But Mr Hands could not say when the UK would be free to strike trade deals, suggesting the issue could form part of negotiations over new trading arrangements with the EU.

He said Britain's position to leave the single market and customs union and then strike a comprehensive free trade deal was "unchanged".

But asked if it would happen when the UK leaves the EU by March 29 2019, he told BBC Sunday Politics: "That's obviously the negotiation that has just started. I am not putting an end date on that.

"What I am saying is the objective in this is to make sure that we have frictionless trade with the European Union and come to a future customs arrangement."

Put to him that it was unclear whether the UK could strike trade deals after March 2019, he said: "Once we have left the European Union and we have left the customs union, we have come to a customs arrangement with the European Union, yes we will be able to make our free trade deals, but at the movement we can't because we're still in the European Union."

Asked if Britain could still strike free trade deals in a transitional period, Mr Hands said: "That remains to be seen, we don't yet know.

"We have only just started the negotiation."

Mr Hands said he could not discuss at what point a transition period may end or begin or even if there would be such an arrangement, adding: "What we are clear about is there should be no cliff edge for businesses in the UK and the European Union and to make sure that trade continues as frictionless as possible."

Mr Hands spoke after a source close to Boris Johnson insisted the Foreign Secretary backs the Prime Minister's Brexit plan "100%" despite claims he could welcome an easing-up on her "red lines" for negotiations.

Mr Davis's former chief of staff James Chapman claimed Mrs May's insistence on leaving the jurisdiction of the European Court of Justice (ECJ) had "hamstrung" his ex-boss in negotiations.

Mr Chapman also claimed the likes of Mr Davis and Mr Johnson could welcome an easing of the PM's Brexit demands, including on leaving the ECJ and Euratom (European Atomic Energy Community), and potentially on immigration.

But a source close to Mr Johnson said he fully supports the Brexit vision Mrs May set out in her Lancaster House speech in January, including leaving the ECJ, single market and customs union.

The Foreign Secretary also wants "managed immigration", while being a supporter of Britain being an "open and diverse country".

Meanwhile, a Number 10 source played down suggestions Mrs May is going to walk out of Brexit talks in September in a staged show of defiance over EU demands for a "divorce bill" of tens of billions of pounds.

The Sunday Telegraph reported a senior Downing Street figure, among the raft of the PM's advisers who have recently left the Government, had briefed industry and City bosses about the plan in an effort to limit the backlash from financial markets.

But a Number 10 source said: "This suggestion has no part in our plans."

Outgoing Liberal Democrat leader Tim Farron said: "This threat to throw her toys out of the pram is a desperate attempt by the Prime Minister to show strength as her approval ratings and influence plummet. It is no way to conduct negotiations that are vital for the future of every family in this country."