After a rough few days, the prime minister had some good news on Monday when Prime Minister Justin Trudeau of Canada said the current Canada-EU agreement, also known as CETA, will be used as a basis for a post-Brexit UK-Canada free trade agreement.
The move will allow a free trade deal to occur swiftly after Brexit, meaning Britain can continue to benefit from the advantages of non-tariff trade with one of the largest economies in the world.
“CETA has significant potential to boost transatlantic prosperity and the UK economy, eliminating 98% of Canadian import duties and massively increasing the opportunities for British exporters, and I am pleased we have agreed today that CETA should be swiftly transitioned to form a new bilateral arrangement between the UK and Canada after Brexit,” said Prime Minister May.
Prime Minister Trudeau was also very bullish about the future agreement, saying: “We will be able to move forward with it in a smooth transition that keeps the essence of CETA applicable to the UK”.
May plans to do what has been dubbed a ‘cut and paste’ job with all current EU trade deals to allow Britain to continue trading with non-European countries in the same way it has within the EU, potentially adapting them once the basic framework is set. This is seen as the only way of avoiding an immediate spike in international tariffs.
While the government has started the week with severe turbulence at home, this is undoubtedly a big win that will reassure British businesses and investors.