Boris Johnson’s government suggested on Thursday that it would walk away from the EU Single Market at the end of the year if a deal could not be reached.
The Prime Minister has insisted that there is still time to agree on a post-Brexit trade deal. With the UK leaving the EU on January 31 and the transition period ending on December 31, there may still be time to come to an agreement.
However, with chief negotiators from both sides recently being put out of action by COVID-19 outbreak and many of the UK civil servants in the Brexit department now assigned to help with the Coronavirus efforts, time is running out.
The government has hinted that if a compromise could not be found between the UK and the EU 27 by the end of the year, trading with the bloc on World Trade Organisation (WTO) terms would be the only option.
On Thursday a UK government spokesperson told reporters, “We will not ask to extend the transition. And, if the EU asks, we will say no”.
Given the current economic fallout from the Coronavirus pandemic, the British government believe that a WTO arrangement could actually be the most flexible option to get the country’s economy back on track.
In an interview with CNBC on Thursday, European Political Analyst Constantine Fraser from research firm TS Lombard said, “The pandemic has completely taken over the agenda in both the EU and in London, and relegated the Brexit talks to a secondary issue,”
“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.”
During a video conference between the UK and EU negotiators on Wednesday, the UK’s chief negotiator David Frost clarified the government’s stance reiterating that there were determined to conclude a trade deal with the EU by the end of 2020.
A series of remote teleconferences have been scheduled for weeks beginning April 20, May 11, and June 1 with a further high-level meeting between leaders in mid-June.
The meeting will determine whether a deal can be brokered by the end of the year or whether the UK will leave on WTO terms.
Under current UK law, the transition period cannot be extended any further, however, many believe that the EU may look for an extension beyond 2020 citing delays caused by the recent COVID-19 crisis.