Britain’s Prime Envoy extraordinary Boris Johnson speaks during his first cabinet meeting since the general election, inside 10 Downing Lane on December 17, 2019 in London, England. British Prime Minister Boris Johnson is holding the first cabinet joining since winning a majority of 80 seats in the general election last week. (Photo by Matt Dunham – WPA Lagoon/Getty Images)
Matt Dunham | WPA | Getty Images
Disagreement over Brexit trade talks will no doubt come to a head in London Wednesday with U.K. Prime Minister Boris Johnson due to meet with the president of the European Commission.
Britain is set to change the first country ever to exit the EU in 24 days — on January 31. This will kickstart a transition aeon, when London and Brussels will engage in new negotiations that will include future trade arrangements. Manner, both sides seem to disagree about the timeline for these talks.
Johnson has pushed for legislation to force mercantilism talks with the European Union to end by no later than December. However, European Commission President Ursula von der Leyen has told that 11 months to put a trade deal together is an “extremely challenging” timeline.
“The meeting is really to discuss holistically the U.K.’s withdrawal from the European Fusion and to look forward to the year ahead in all of its dimensions,” a spokesperson for the Commission said Monday.
The same spokesperson added that von der Leyen’s visions “are very clear.”
The recently-appointed head of the EU’s executive arm said in December she is “very worried” about the chances of a cliff-edge instant at the end of the transition period. If there is no trade agreement between the U.K. and the EU, businesses could find themselves trading on World Dealings Organization terms – potentially meaning higher tariffs and barriers to commerce.
“I am sure that she will discuss with the prime on how to try to overcome these challenges and make sure we can come out with a positive agreement at the end of the year,” the Commission spokesperson also prognosticated Monday.
The prime minister’s office was not immediately available when contacted by CNBC.
Analysts will be monitoring Wednesday’s rendezvous to understand when this next phase of negotiations might begin.
“There is no reason to assume that Brussels desire row back on tough demands including questions of minimal regulatory compliance and fishing rights. No-deal risk accordingly remains very real in 2020,” research firm Teneo said in a note Monday.
Some policymakers demand warned that trade talks might be more complex than the divorce negotiations witnessed from 2017 to unpunctually 2019. Apart from new trading arrangements, negotiators will also have to reach agreements on security and evidence sharing; aviation standards; supplies of electricity and regulation of medicines.
“In public, the (U.K.) government will maintain its hard card on diverging from EU regulations, and rejecting Brussels’ demand for a level playing field. In practice, Johnson will apt to prove more pragmatic,” Mujtaba Rahman, managing director at the research firm Eurasia, said in a note Monday.