Written by Paul Seddon and Kate WhannellPolitical reporters
Getty ImagesNegotiations between the UK and Canada on a post-Brexit trade deal have collapsed after nearly two years, following a row over beef and cheese.
Canada is pressing the UK to ease its ban on hormone-treated beef, which its producers say in effect prevents them from entering the British market.
The UK has concerns about the 245% import taxes Canada imposed at the start of the year on British cheese.
The stalled talks mean British car companies could also face higher tariffs.
It will also mean that the UK's trading terms with Canada will now be worse than when they were part of the EU deal with Canada.
Minnette Butters, president of the National Farmers' Union of England and Wales, said she was pleased the UK government had not “compromised” on hormone-treated beef.
But the British Chambers of Commerce (BCC) and the Society of Motor Manufacturers and Traders (SMMT) described the news as unwelcome.
Downing Street said the government would “only negotiate deals that serve the British people” and reserved the right to “pause negotiations when progress is not made”.
But a company spokesperson added: “We are open to resuming talks with Canada in the future.”
No 10 rejected the suggestion that Brexit had left the UK worse off on international trade, saying that “one of the benefits of our independent trading status is that we are able to insist on the details of each deal to precisely ensure its success.” In the interests of the United Kingdom.
Trade between the two countries currently takes place under the terms of a deal that the UK has been delaying since it was a member of the EU.
A time-limited agreement allowed the UK to continue selling cars and cheese without high import taxes. But talks about extending it as part of a new deal have now collapsed.
The cheese arrangements expire on December 31, 2023, triggering taxes of up to 245% on British imports, while the car deal is set to expire in April.
This is the first time the UK has formally suspended talks with a trading partner since officially leaving the EU trading system in 2021.
Talks between the two countries regarding reaching a detailed agreement have been ongoing since March 2022.
'Relief' for UK farmers
A spokeswoman for Canadian Trade Minister Mary Ng said she was “disappointed” that the talks had stalled, and informed British Business Minister Kimmy Badenoch of this.
“Their decision to continue to maintain market access barriers to our agricultural industry and unwillingness to reach a mutual agreement has only served to stall the negotiations,” the spokeswoman added.
“The UK is a long-standing trading partner and I am confident we can negotiate a win-win agreement for Canada and the UK.
“But let me be clear – we will not negotiate an agreement that is not in the best interest of Canadians – and not in the best interest of our Canadian businesses, farmers and workers.”
Total merchandise trade between the two countries reached 19.2 billion pounds sterling in 2020. According to the UK governmentwith UK imports from Canada worth £7.3 billion and UK exports to Canada worth £11.8 billion.
Ms Butters said the UK's decision would come as a “relief for farmers”.
She told BBC Radio 4's Today program she was happy that “the government is sticking to its line and not giving in”.
“We have already damaged our economy and agricultural sector by fully liberalizing trade agreements with Australia and New Zealand. We have had to take a strong stance on this.”
However, William Payne, head of trade policy at the BCC, said: “For our dairy exporters and parts of our processing industry, the loss of key trade preferences puts them worse off than they were before 2020.
“The government must help these sectors through difficult times and open new markets for our goods and services.”
SMMT CEO Mike Hawes said the collapse of the talks sent “a signal that world-class British automotive products are not welcome in Canada.”
He added: “If UK car exports cannot use EU parts and components to avoid additional duties, this creates the risk of tariffs being reintroduced, potentially being imposed in addition to luxury goods taxes.”
“Weaker”
The Canadian Cattle Association said it supports its government's “tough approach” to beef rules, adding that the UK “has shown no indication it is ready to fully accept Canada's food safety system, which is widely recognized as one of the best in the world.” world”.
Labour's shadow business secretary Jonathan Reynolds said: “This is extremely worrying news and another major failure by the Conservatives to deliver on their promises.”
He added: “Instead of strengthening our post-Brexit trade position, these failures have left us in a weaker position, especially for the automotive sector.”
The Scottish National Party's international trade spokesman, Richard Thomson, said: “Westminster's exit from the European Union has damaged the UK's global trade potential and dragged Scotland's economy down with it.”
Former Environment Minister George Eustice told the BBC that the UK was “absolutely right to suspend negotiations” and that Canada should “accept the need to adhere to British food standards.”
Mr. Eustis, who strongly criticized the trade agreement between the United Kingdom and Australia, He said the government must ensure that “any access granted to hormone-free beef from Canada matches the access of British dairy products to the Canadian market.”
Speaker of the House of Commons, Sir Lindsay Hoyle, expressed his frustration at the announcement of the cessation of talks to the media before MPs.
“I will say it is amazing how quickly the government comes forward to deliver good news… I always think this council should hear it first,” he said.
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