U.K. Faces Challenges In Negotiating New Trade Deals After Brexit
KELLY MCEVERS, HOST:
Protect the country's borders or keep access to European markets. This is the dilemma facing the United Kingdom as it figures out how to leave the European Union. Yesterday Prime Minister Theresa May made the border issue her priority. In other words, controlling immigration, but clamping down on borders means losing access to Europe's single market. So now there's the challenge of negotiating all new trade agreements, something the U.K. never prepared for. NPR's Frank Langfitt has more.
FRANK LANGFITT, BYLINE: Speaking before a Conservative Party conference in Birmingham, May said she'd like to maintain open access to EU economy.
(SOUNDBITE OF CONFERENCE)
THERESA MAY: I wanted to give British companies the maximum freedom to trade with and operate within the single market and let European businesses do the same here.
LANGFITT: Then she made it clear her top priority was honoring those who voted for Brexit in June - people who said they wanted the government to take control of the country's borders.
MAY: But let's state one thing loud and clear. We are not leaving the European Union only to give up control of immigration all over again. That's not going to happen. We are leaving to become once more a fully sovereign and independent country.
LANGFITT: But the EU has said the U.K. can't have it both ways. If it won't allow the free flow of labor, it can't have free access to the world's largest collective economy. When people in London talk about the complexities of leaving the EU, many just shake their heads. By all accounts, the task ahead is Herculean.
REM KORTEWEG: Negotiating Brexit is the most challenging issue facing the British government since the end of the Second World War.
LANGFITT: Rem Korteweg is a senior research fellow at the Center for European Reform. It's a think tank focused on improving the EU. He says unwinding the current trade relationship with the European Union and refashioning a new one involves a mind-boggling array of issues.
KORTEWEG: Fishing quotas, agricultural subsidies, cooperation in financial services. If you want to make an analogy, it's climbing Mount Everest while you are absolutely unprepared.
LANGFITT: Unprepared because the U.K. has little in-house trade talent. For the past four decades, EU negotiators in Brussels did all the work.
KORTEWEG: And so it really hasn't had to bother with the nitty-gritty details of - how do you develop a tariff schedule of your own? How do you understand quotas, and how do you negotiate them?
LANGFITT: This summer, the U.K. government acknowledged it needed to hire up to 300 staff to fill the gap in trade expertise - not just to deal with the EU, but also for new trade deals with other countries. It reached out to the Canadian, New Zealand and Australian governments for manpower. Miriam Gonzalez says there's something awkward about the conundrum the government now finds itself in.
MIRIAM GONZALEZ: It would be ironic - wouldn't it? - if the U.K. is leaving the European Union to acquire control, and they were to outsource to another nationality and exist negotiation of such a crucial area.
LANGFITT: Gonzalez is a former EU trade negotiator and helps run the International Trade Practice at the law firm Dechert. She says you can't just grab negotiators from a foreign government and plug them into the U.K., and there aren't enough to go around, anyway. The U.K. will also probably need legal help on Brexit and is expected to reach out to private firms.
MATTHEW WEINIGER: There are threats and opportunities arising out of Brexit.
LANGFITT: Matthew Weiniger is a partner with the law firm Linklaters London. He says the city doesn't have a deep reservoir of top trade lawyers the way, say, Washington does.
WEINIGER: But there's a good possibility that that level of legal expertise can be created and replicated in England, so that is a great business opportunity for London based law firms.
LANGFITT: The threat, Weiniger says - the highly paid lawyers take some of the blame if Brexit goes south. The government has declined to say just how many new people it's brought on so far to handle the massive task. In a statement, it would only say departments dealing with Brexit are, quote, properly resourced. Frank Langfitt, NPR News, London.
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