Brexit: Switzerland trade deal signed by Liam Fox attacked for leaving out services

Agreement struck by trade secretary in blaze of publicity 'differs significantly from the EU-Swiss agreements it replaces'

Rob Merrick
Deputy Political Editor
Wednesday 13 March 2019 17:58 GMT
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Liam Fox’s claim to have secured a post-Brexit trade deal with Switzerland of “huge economic importance” has been sharply criticised – because it fails to protect about half of current commerce.

The agreement – one of the few successfully ‘rolled over’, with the scheduled departure from the EU just 16 days away – does not cover services, a committee of peers has warned.

“Most trade in services, which make up 52 per cent of all UK-Swiss trade, is not covered by the deal,” its report says.

Trade with Switzerland, which is outside the EU but participates in its single market, is worth about £31bn a year to the UK economy, making a rollover a key government priority.

Signing the deal in a blaze of publicity last month, Dr Fox said: “This is of huge economic importance to UK businesses so I'm delighted to be here in Bern ensuring continuity for 15,000 British exporters.”

But the report, by the House of Lords EU Committee also highlights that:

* The deal risks new limits on the export of agricultural products from the UK to Switzerland – for example, a possible ban on organic products.

* Switzerland may no longer recognise UK businesses as “authorised economic operators”, eligible for lighter controls at the Swiss border.

Lord Boswell, the committee’s Conservative chairman, urged MPs and peers to investigate the possible weaknesses before ratifying the Swiss deal.

“Trade with Switzerland matters. It’s our 10th biggest trading partner globally and the third largest of non-EU States,” he said.

“We have a large trade surplus in services with Switzerland, including financial services and professional business services. So it’s important we get our future trading relationship right.”

The agreement signed by Dr Fox “in many aspects differs significantly from the EU-Swiss agreements it replaces,” Lord Boswell added.

The report points out that Switzerland is only the UK’s 15th largest partner in goods trade – but the 7th largest for services.

“The UK has a large trade surplus in services, overwhelmingly made up of financial services (£1.95bn) and other business services (£6.5bn),” it states.

Dr Fox has run into criticism because his department for international trade has struck “continuity agreements" with just seven of the 69 countries and regions with which the EU has trade deals.

They give businesses “a range of preferential market access opportunities”, including cheaper import tariffs and duties and more relaxed “rules of origin” requirements.

The deals also deliver “enhanced market access” for services, “public procurement opportunities” and “improved protections for intellectual property”.

In 2017, Dr Fox confidently predicted the deals, accounting for around 11 per cent of the UK's trade, would all be ready for “a second after midnight” on Brexit day.

Roll overs with Switzerland, Chile, the Faroe Islands, Eastern and Southern Africa, Israel and the Palestinian Authority have been secured – but the deals with Japan and Turkey, for example, will not be ready, he admitted.

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