During the lead-up to the eventual Brexit vote in the UK, one of the major complaints of those who wanted Britain to remain in the European Union is that, by exiting, the UK’s trade situation would be thrown into chaos, and it would not be able to work out viable international trade deals.
Those in favor of leaving insisted that this was pure propaganda. They reassured everyone that just as Britain was able to carry on trade negotiations before the existence of the EU, it would be able to do so after leaving the EU.
Pro-Brexit people have humorously taken to calling remainers “remoaners” over the incessant complaints and worries about the alleged doom that would befall the UK if it left the EU.
Well, according to a recent report, the pro-Brexit side was right after all. The trade fears of the remoaners do indeed appear to be overblown.
Indeed, British trade Secretary Liz Truss has reportedly said that Britain is already making “rapid progress” on the way to working out a new trade deal with New Zealand.
Trading With the Kiwis
Britain and New Zealand have already agreed on a preliminary outline of their eventual deal. In fact, this week, Secretary Truss will be meeting with her New Zealand counterparts for the fourth and final time to hammer out the final version of this new trade agreement.
This new agreement is likely to be extremely beneficial to both nations, especially where the issue of tariffs is concerned.
Currently, the EU imposes a 20 percent tariff on all imports from New Zealand, which severely limits the ability of firms from that country to sell to and penetrate European markets.
However, now that the UK can negotiate its own trade agreements, it’s highly likely that tariffs on New Zealand imports to the UK will be much lower. New Zealand will also correspondingly cut its tariff rates on British imports.
The incoming prospect of this has made British tea manufacturers, chocolate makers, and motor home producers very happy indeed.
In the 1960s, as much as half of New Zealand’s exports went to the UK, but starting in 1973, when the UK became part of the European Economic Community — an economic forerunner to what eventually became the EU — the general trading relationship between the two nations has taken a nosedive.
Brexit has presented an opportunity to revive and rekindle that relationship. If implemented, the already £2.9 billion trading volume between the two countries is expected to soar much higher.
Furthermore, it is hoped that this deal between Britain and New Zealand will be a prelude to a larger £9 trillion trade agreement called the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, which will involve a total of 11 countries.
Other trade deals between Britain and Canada and Japan have already been secured. Unfortunately, the prospect of a deal with the US is not terribly great. Biden, after all, sees Brexit as a mistake and currently appears to be more concerned with striking trade agreements with Ireland.
In any case, it appears clear that the remoaners were wrong. Post-Brexit, the British economy seems to be just fine.