As the Brexit deadline looms, the UK Prime Minister, Boris Johnson has discussed the “strong possibility that we will “leave the EU on Australian terms”.
This statement comes as the UK government and the EU have yet to agree to a deal, despite it being just over two weeks until the official Brexit deadline.
What are Australian terms?
‘Australian-terms’ refers to the 2017 ‘framework agreement’ which was signed by the Australian government and the EU. This covers cooperation regarding trade, humanitarian issues, security, foreign policy and development. While an agreement was made, in essence, this is not an official trade deal, as Australia’s trade follows the World Trade Organisation’s regulations by default.
The former Australian Prime Minister, Malcolm Turnbull has urged against this type of deal, as he discussed how ‘Australians would not regard our trade relationship with Europe as being a satisfactory one.’ He also referred to the ‘big barriers to Australian exports of agricultural products in particular’, as the Australian government continues ninth round negotiations to agree upon a comprehensive trade deal with the EU.
Australia has been negotiating for over two years with hopes of gaining a better deal. Brexiteers are supportive of a no-deal decision as they believe it offers a clean break. Yet the government is still holding out for a Canada style Brexit deal despite the looming deadline and prospect of ongoing negotiations potentially for years to come.
The former Australian Prime Minister, Malcolm Turnbull has urged against this type of deal, as he discussed how ‘Australians would not regard our trade relationship with Europe as being a satisfactory one.’
Many believe Johnson’s reference to ‘Australian-terms’ is just a way of repackaging a no-deal scenario. By contrast, Britain will be far worse off than Australia if a similar deal was to go ahead.
This is because Australia has some general agreements in place with the EU. For instance, in 2015, a deal was made to ensure Australia’s participation in the EU’s Crisis Management Operations.
If the UK government were to agree on an ‘Australian-style’ Brexit, then they would not benefit from the same agreements which would not only affect trade goods, including the current standoff issues regarding fishing disputes. Britain also trades more than half its goods with the EU, in comparison to just 11% of raw materials with Australia.
The End of Brexit talks
The final announcement regarding the trade talks outcome is expected to be made at any moment, with a “no-deal” being the most likely outcome. The European Commission President Ursula Von der Leyen said that negotiations are ‘on the very last mile’. The discussion appears to be focusing on level playing field, as both the EU and the UK government decide on the best way to find common ground “not only at the start but also over time”.
Both the UK Prime Minister and the European Commission President have accepted their ‘responsibility’ to reach a reasonable deal. However, Boris Johnson has now urged businesses and members of the public to prepare “with confidence” for a no-deal scenario but with no further information on what exactly to prepare for.
If no deal is made, then Britain will leave the EU under World Trade Organisation terms which could lead to continued negotiations for many years.
[Header image: Stock.adobe.com, UniqueEye]