Thread by @AnnaJerzewska

With the PM in Brussels, here is another reminder. On the deal vs no deal. And borders.

We need a deal. It’s in everyone’s interest. It will reduce tariffs (perhaps even full tariff/quota-free) and offer a range of other simplifications. BUT everything will still change

/1

One albeit (over)simplified way of looking at it is 👇

You have a border and what happens behind it.

⏺️Border barriers (friction, formalities, tariffs) and
⏺️Behind the border measures (regulation, alignment, cooperation etc)

/2

On the border barriers front, a deal would remove tariffs.

That's pretty much it.

Plus perhaps some additional simplifications, derogations (maybe some on SPS stuff depending on how far both parties want to go).

/3

A deal wouldn't change that much from a no-deal scenario:

⏺️Customs formalities and checks
⏺️SPS formalities and checks stay
⏺️New requirements to demonstrate products are eligible for tariff-free treatment added (rules of origin)
⏺️Loss of freedom of movement stays

/4

On the behind the border side of things there is so much to cover: product regulation, services, investment etc.

This is where a deal could introduce a number of interesting facilitations. But there is a massive caveat here.

/5

The default position even under a deal will be that the UK is a 3rd country.

In all these areas, FTAs can introduce harmonisation (occasionally alignment), simplifications etc. but the significance of these provisions varies and should not be overestimated.

/6

(Caveat tweet - everything on the behind the border stuff will depend on 1) which area are we talking about 2) what will be agreed and how it will be worded in the text. Range of issues here and by definition I'm oversimplifying things in this 🧵)

/7

FTA will at best minimise the impact. It will not provide continuity in these areas.

And we will gradually begin to see these changes on 1 Jan.

Important to point, nothing has changed yet. Despite all of us talking about little else for 4 years.

/8

The reason I'm tweeting this is cause we keep hearing that a deal will provide a free flow/ frictionless trade/ continuity.

That things will be as they are. As long as we get a deal, it will be alright.

/9

Key point: even with a deal there will be significant changes in almost all areas. Whether it's getting a container in or something as trivial as bringing your pet with you on your holidays.

A lot of these changes aren't clear yet (i.e. we need to see the deal)

/10

So while I will be very glad to see a deal between the UK and the EU, the important part is that the transition period is ending and we're becoming a 3rd country, with all the implications - hopefully one with a good and not too shallow FTA with the EU.

/ends