BEIJING (Reuters) – Britain’s Chancellor of the Exchequer Philip Hammond said it is likely Britain will want to negotiate a bespoke arrangement for future trade deals with the European Union.
Speaking at a press conference in Beijing on Saturday with Chinese Vice Premier Ma Kai and Chinese Vice Finance Minister Shi Yaobin, Hammond said he expected that the United Kingdom would develop a trade deal that is not a “Canada model.”
Hammond, who is in China on an official visit, was referring to a deal similar to the one the EU agreed to last year with Canada.
Shi told reporters that China believes Britain and the EU are able to reach an agreement that is satisfactory to both sides.
The European Union agreed on Friday to move Brexit talks onto trade and a transition pact but some leaders cautioned that the final year of divorce negotiations before Britain’s exit could be fraught with peril.
EU leaders, who had offered British Prime Minister Theresa May a rare summit round of applause over dinner in Brussels the night before, took just 10 minutes to agree that she had made “sufficient progress” on divorce terms last week and to give negotiators a mandate to move on to the main phase of talks.
Summit chair Donald Tusk said the world’s biggest trading bloc would start “exploratory contacts” with Britain on what London wants in a future trade relationship, as well as starting discussion on the immediate post-Brexit transition.
The Brexit negotiations have been a vexed issue for the global economy as markets feared prolonged uncertainty would hit global trade and the growth.
A transition period is now seen as crucial for investors and businesses who worry that a “cliff-edge” Brexit would disrupt trade flows and sow chaos through financial markets.
Hammond’s China visit is the latest instalment in long-running economic talks between the two states but it has now taken on new importance for Britain as it looks to re-invent itself as a global trading nation after leaving the EU in 2019.
(Reporting by Ben Blanchard; Editing by Shri Navaratnam)