Boris Johnson and Justin Trudeau agreed to the deal during a video call early Saturday morning. During the call, both British Trade Secretary Liz Truss and Canadian Trade Minister Mary Ng also took part in the official signing of the agreement.
The deal in question will ensure that around £20 billion in trade per annum between the two nations will continue after the UK officially leaves the EU at the start of the next year. This comes as UK businesses export ‘£11.4 billion worth of goods and services to Canada each year‘.
The main business sectors that look to mainly prosper is car manufacturers and drink services. Some businesses have acknowledged this, the Scotch Whisky Association which has stated that ‘the new agreement is good news for Scotch Whisky exports’. In addition to this, it was also stated that the deal in question ‘aims to secure fairer access for Scotch Whisky to the Canadian market’. This would be done through major provincial realignment of the liquor boards within Canada, which have had limited market access in the past.
As reported by Politico, the Chief Executive of the Wine and Spirit Trade Association Mile Beale has stated that ‘this agreement doesn’t just confirm the continued removal of tariffs, but gives us some extra footing and mechanisms to engage with the Canadians on their complex alcohol market, which is controlled at a provincial level’. The whiskey industry in the UK has been particularly damaged in recent months due to the ongoing trade disputes between the EU and America regarding Boeing and Airbus.
Alongside this, the Canadian Dairy industry has been vocal in the past around foreign market access under previous trade deals. These have included both the EU-Canada trade deal and the much newer Canada-United States-Mexico Agreement signed under the Trump administration. In addition to this, Global Shipping Giant OOCL of Hong Kong has chosen to expand into Liverpool’s port, stating that it will ‘increase capacities and support increased demand for container imports’ and ‘increase its share of the container market by 15% to 20% in Liverpool by 2025’. These developments have given the hope that there will be a major shipping link between the UK and Canada via this expansion, which will undergo further developments whilst further trade agreements are signed.
The new agreement between the United Kingdom and Canada will now make its way through both houses of the Canadian legislature. It is hoped that this continuity deal will lay the groundwork for a much newer and more expansive trade deal in the following year. Alongside this, there will be emphasis on further cooperation on topics like financial technology and other forms of digital trade. This is something that both nations will look to increase and promote as the UK leaves the EU on the 1st January 2021. This in turn begs the bigger question over the status of CANZUK – is it really happening?
Currently, it is still too soon to say – mainly due to the lack of current existing deals between both Australia and New Zealand. From this, former Australian Prime Minister Tony Abbott (now working for the UK government as a trade advisor) has been heavily pushing for Australia to sign a Japanese style deal with the UK before the end of 2021. The nature of this proposed deal is still up in the air and ultimately subject to changes. The same can be said about New Zealand under Jacinda Ardern’s premiership, which – as a result of her election success this year – has managed to see the protectionism of ‘New Zealand First’ become rejected within her government and nation. This is especially relevant when considering that trade ‘between the U.K. and New Zealand is currently worth £2.9 billion, according to the Department for International Trade’.
Overall, the topic of CANZUK and the new UK-Canada trade agreement is still undergoing developments, making it too early to tell what it will result in. However, as more nations attempt to recover from the economic downturns of the coronavirus and economic lockdowns, the topic of further economic trade within the Anglosphere will only become more enticing for such nations.
Featured image credit: Pam menegakis on Unsplash