Britain and Canada decided on Saturday to negotiate a new bilateral trade deal in 2021, postponing the terms of the EU’s CETA trade deal with Canada.
Prime Ministers Boris Johnson and Justin Trudeau sealed the rolling pact during a video call early this morning. UK Trade Secretary Liz Truss and her Canadian counterpart Trade Minister Mary Ng also joined the call.
The deal will ensure that nearly £ 20 billion in annual trade between countries will continue to flow after Britain leaves the EU on January 1, 2021. UK companies export £ 11.4 billion sterling of goods and services in Canada every year. Sectors likely to thrive from continued trade in the UK include car manufacturers and the food and drink industries.
British businesses celebrated the news. “The new deal is good news for Scotch Whiskey exports,” a Scotch Whiskey Association (SWA) spokesperson said of the tentative deal. They noted that it “seeks to ensure more equitable access for Scotch whiskey to the Canadian market” through commitments that target the practices of provincial liquor boards in Canada that limit market access.
“This agreement not only confirms the continued elimination of tariffs, but gives us additional foundations and mechanisms to engage with Canadians in their complex alcohol market, which is controlled at the provincial level,” said Miles Beale, Director. General of the Wine and Spirits Trade Association.
The deal must now make its way through both houses of Canada’s Parliament before the Christmas recess on December 11.
The UK and Canada are also set to negotiate a new bespoke trade deal next year with the ambition to push for deeper cooperation on digital trade and the environment.