EU leaders risk major damage to their economies if they force UK into no-deal Brexit, Liam Fox says

International trade secretary tells 'Brussels bureaucrats' not to put 'abstract ideology' ahead of people's 'economic prosperity and wellbeing' as he announces consultation on new trade deals

Benjamin Kentish
Political Correspondent
Wednesday 18 July 2018 12:33 BST
Liam Fox said the UK will prioritise trade deals with the US, Australia and New Zealand
Liam Fox said the UK will prioritise trade deals with the US, Australia and New Zealand (Getty)

Liam Fox has warned European leaders they risk seriously damaging their countries' economies if they force the UK into a no-deal Brexit.

The international trade secretary told the EU "the ball is in their court" as he called on "Brussels bureaucrats" not to sacrifice the wellbeing of their citizens for the sake of "abstract ideology".

He claimed the economies of European countries would take a hefty hit if the UK crashes out of the EU without a deal, putting the "prosperity and wellbeing" of EU citizens at risk.

Speaking in central London, Dr Fox announced four consultations on the first deals the UK hopes to strike after Brexit. In addition to trade agreements with the USA, Australia and New Zealand, Britain will also seek to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), which includes countries such as Canada, Japan, Mexico and Singapore.

The international trade secretary also used the speech to warn EU leaders not to force the UK to leave the bloc without a trade agreement.

Asked if he thought the proposed deal approved by ministers at Chequers was likely to survive, despite opposition from Tory Brexiteers, Dr Fox said: "I think you have to ask the EU 27 that, because we made an offer to the EU 27. The ball is now in their court.

"We think that's a fair and reasonable deal and they have to understand what no deal might mean as a consequence for their economies."

He continued: "When I read that no-deal would not be a big impact on Europe overall, first of all I doubt the analysis but, secondly, no deal would be very disproportionately shared and might mean reduction in GDP of something like 4 per cent for the Netherlands, 3.5 per cent for Belgium and 7 or 8 per cent for Ireland.

"I think you understand why we need to have a people's Brexit, not a bureaucrats Brexit - in other words one that's done for the citizens of Europe and their economic prosperity and wellbeing, not the abstract ideology of the Brussels bureaucrats."

Announcing consultations on future trade deals with the countries the government sees as a priority, Dr Fox said: “For the first time in over 40 years we will be able to determine who we trade with, and on what terms.

“That doesn’t just mean new trade agreements with key partners like the USA, Australia and New Zealand, revitalising our existing trade. It also means putting the UK at the heart of the world’s fastest growing regions with agreements like the Comprehensive and Progressive Agreement for Trans-Pacific Partnership.

“I want everyone to have their say, to make sure our future trade policy works for the whole of the UK. Trade affects us all and I urge anyone with an interest to take part in these consultations.”

Dr Fox insisted the Brexit plan agreed by ministers at Chequers would not scupper the prospect of new trade deals with other countries, particularly the US.

He said: "I don't agree with the assumption we can't do a full agreement with the United States.

"We will have absolute freedom to change our quotas and our tariffs, including on manufactured goods, under the agreement that was made at Chequers."

He also suggested the UK could agree to lower tariffs on US cars as part of trade deal, saying Donald Trump is "very concerned" that US cars being sold in Europe face a 10 per cent tariff while European cars going the other way only face a 2.5 per cent levy.

The international trade secretary said the Chequers proposal would give the UK "absolute freedom" to lower UK tariffs on imported products.

He said: "When we leave the EU, if it is under that Chequers agreement, we have absolute freedom to change those manufacturing tariffs and that at the moment is one of the key focuses that the US has."

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