Translated by
Nicola Mira
Jun 27, 2016
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Has Brexit compromised free trade with Canada and the USA?

Translated by
Nicola Mira
Jun 27, 2016

The EU's free trade negotiations currently underway are now in no man's land, casting a shadow over the agreement sought with Canada and especially the USA, which was already widely opposed before the UK referendum.


The US government issued a warning in October: in case of Brexit, the UK would be facing customs barriers to trade with the USA. This was a sizeable threat, since the USA is the UK's main trading partner, but it was not sufficient to convince UK voters to remain in the EU.

Because the UK's exit has been proclaimed, but in theory will occur only in two years' time, the EU is now faced with a major challenge: how to progress with the free-trade negotiations under way, when one of the main negotiators will soon become a significant competitor?

Launched in 2009, the trade negotiations between Canada and Europe were in theory supposed to pass into act in the first half of 2017, subject to the European Parliament's approval. As for the Transatlantic Free Trade Area (TAFTA), which would link Europe to the USA, Brexit may turn out to be the final nail in its coffin.

Things did indeed heat up recently, on the European side, when Barack Obama tried to finalise the agreement before the end of his mandate, in January 2017. With the 13th round of negotiations in full swing, French President François Hollande refused to even touch on the issue during a meeting in Berlin. France and Germany are indeed divided on this: Germany, as the world's second largest exporter, is in fact less exposed by current regulations.

In 2013, the EU imported €80.7 billion euros in apparel and €28.6 in textiles. It exported €22.7 billion in apparel and €21.8 billion in textiles. The European Commission pointed out that the maximum ad valorem tariff applied for the industry to goods entering Europe is 12%, compared to 32% in the USA, while customs duties amount to 8% on average in Europe, compared to 9.4% in the USA.

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