Post-Brexit Trade Talks Could Be Derailed By The Coronavirus Crisis

According to analysts, the coronavirus pandemic raging through Europe threatens to slow down official talks on Brexit which makes it unlikely that the United Kingdom will be able to come to a formal agreement with the European Union on a departure deal by the end of the year.

A pledge to get the Brexit negotiations completed by this year has been made by the UK Prime Minister Boris Johnson. Since January 31, when the UK officially exited the EU, it has been in a transition phase and the two parties have until December 31 to come to an agreement of a large range of issues that will help establish the future relationship between the two. It includes a trade agreement with the remaining 27 country block.

However, after the two lead negotiators had to isolate due to Covid-19 infections, the pace of negotiations has suffered a setback, putting the entire timeline at risk.

“The pandemic has completely taken over the agenda in both the EU and in London, and relegated the Brexit talks to a secondary issue,” Constantine Fraser, European political analyst at research firm TS Lombard, said in a television interview.

“It was always going to be difficult to reach an agreement in the limited time available this year, the pandemic means it will now be impossible,” he added.

Members of the negotiating from the UK and the EU held a call on Wednesday which was the first since the tow lead negotiators of both sides were forced to self-isolate because of the virus pandemic.

After having tested positive for the novel coronavirus in March, the EU’s negotiator, Michel Barnier, has since recovered. Last month, The UK’s Johnson also tested positive for the coronavirus last month and had to be admitted to a hospital. He has since been discharged from the hospital and is recuperating at home in isolation.

The UK government had no intention to ask for an extension to the current transition period, UK negotiator David Frost said during their call. London will not ask for a delay, confirmed a UK government spokesman on Thursday.

“The government insists that all is on track, but we all suspect not,” Vicky Pryce, chief economic adviser at the Centre for Economics and Business Research in London, said in a television interview. “I am hearing that quite a lot of civil servants who were doing Brexit have been moved temporarily to coronavirus and that must delay the putting into U.K. law what was EU law,” she continued.

It is legally possible for the UK to extend the ongoing transition period by July 1. The delay could last up to two years, meaning December 2022.

The EU is ready to discuss an extension of the transition period, said a spokesperson for the European Commission, the EU warm that negotiates with the UK on behalf of the other 27 EU countries.

Therefore it is now the prerogative of the UK government to restart the talks on Brexit.

“We should not rule an extension out despite the official position. (U.K.) ministers would likely accept a six- or 12-month delay given the circumstances,” Kallum Pickering, U.K. economist at Berenberg told the media.

(Adapted from CNBC.com)



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