UK and Canada and BREXIT

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Inexperience of British trade team created ‘frustration’ during early talks for a potential Canada-U.K. pact, experts say

By NEIL MOSS      
Rideau Potomac Strategy Group’s Eric Miller says ‘a number’ of Canadians have been offered positions on the British team, but turned them down due to the inadequate salary being offered.

Before Canada-U.K. preliminary trade talks cooled, the inexperience of the British negotiation team complicated the discussions, observers say.

“They have never done this before,” said Eric Miller, a former senior policy adviser to the Canadian Embassy in Washington, D.C., and current head of the Rideau Potomac Strategy Group.

The United Kingdom has not negotiated a trade deal since it entered the European community in the 1970s, and with a potential hard Brexit nearing, a group of inexperienced trade negotiators have to complete trade deals with numerous countries, including Canada.

“They’ve been desperately trying to put together a trade negotiation infrastructure. … It’s not that they don’t have smart people or capacity—they’ve got plenty of that—it’s just trade negotiations are their own distinct beast and having a mechanism to advance them is something that is developed over time,” he said.

Anthony Cary, who served as British high commissioner to Canada from 2007 to 2010 and now heads the annual Canada-U.K. Council, said the experienced negotiators that Britain does have who worked for the European Commission might not be viewed favourably by the current government.

“The U.K. does have experienced negotiators who have been working in Brussels, but they might not be welcome in Whitehall at the moment, even if they were prepared to help deliver a policy that most of them deplore. The neutrality of the British civil service is under intense pressure. Ministers and their political teams give [the] impression [that] they value True Belief over expertise or impartial advice,” he said in an email.

The inexperience has frustrated the now-halted early talks, trade observers say.

Canada entered exploratory talks with Britain over a potential free trade deal for when the U.K. makes it long-delayed departure from the European Union in 2017, but those talks have since slowed. Formal trade discussions can’t take place until Britain officially leaves the EU. The discussions cooled after Britain released a “temporary list” on March 13 in which it was reported any country could have 87 per cent tariff-free access to the British market for products on the list without any need for equal tariffs cuts.

Jason Langrish, executive director of the Canada Europe Roundtable for Business, said there was “frustration” on the Canadian side due to the inexperience.

He said the lack of experience can “grind negotiations to a halt,” due to unfamiliarity with managing political masters, and the lack of structures for interdepartmental co-ordination.

Mr. Cary said the inexperience gap can be “frustrating” for both sides, with misunderstanding and small issues being blown out of proportion and becoming “major sticking points.”

Brian Kingston, vice-president of international and fiscal policy at the Business Council of Canada, said that Britain was hampered by then-Secretary of State for International Trade Liam Fox’s “extremely ambitious” plan to roll over 40 trade deals the “second after” Brexit.

Canadian negotiators are typically focused on one agreement at a time.

“You can dedicate all your time to it, and you can make sure that you are fully cognizant of everything that’s happening,” Mr. Kingston said, adding that it created a capacity issue for the Brits, when they were having trade talks with Japan, Korea, and others, at the same time they were holding preliminary trade discussions with Canada.

A U.K. Department for International Trade spokesperson said Canada and the U.K. have agreed to work towards a “seamless transition of [Comprehensive Economic and Trade Agreement] CETA,” and the U.K. is committed in doing so.

“We are continuing to work on securing continuity with other countries. Last month, we reached agreement in principle with Korea and a continuity trade agreement was signed on July 18 with six Central American countries. Once the Korea agreement is signed, we will have agreements with countries covering 64 per cent of our trade for which we are seeking continuity,” the spokesperson said.

Boris Johnson became the newest British prime minister on July 24. He has promised that the U.K. will leave the EU after Oct. 31, even if there is no deal.

Britain’s new Secretary of State for Foreign and Commonwealth Affairs Dominic Raab reiterated Mr. Johnson’s stance while speaking to reporters in Toronto on Aug. 6 alongside Foreign Affairs Minister Chrystia Freeland (University-Rosedale, Ont.), but added that having a withdrawal agreement would be preferable.

Colin Robertson, middle, says Global Affairs’ trade team is ‘an area of Canadian competence and expertise.’ The Hill Times file photograph

British cabinet minister Michael Gove—responsible for preparations for a potential hard Brexit—is blaming the EU for refusing to negotiate, according to the BBC. A European Commission spokesperson in Brussels responded that the EU is open to talks, but its position hasn’t changed, Bloomberg reported.

A hard Brexit would create uncertainty for Canadian exports to Britain.

The terms of a Canada-U.K. trade pact would be influenced by the terms of a withdrawal agreement, a Global Affairs Canada spokesperson told The Hill Times. If a withdrawal agreement was reached, Canada would allow the U.K. to remain party to CETA. Even if there is no transitionary trade deal, Canada has been promised custom-free access to 95 per cent of all tariff lines, the spokesperson said.

A lack of ‘continuity’ defined early trade talks between Canada and Britain

Colin Robertson, a former diplomat and trade negotiator on the Canada-U.S. Free Trade Agreement, said British negotiators gave Canada some attention, but would then would disappear.

The situation was being compounded, as Britain’s best negotiators were preoccupied with the Brexit negotiations, Mr. Robertson said, and some of the British negotiators who may have been present at a meeting with Canadian officials disappeared to focus on another country or Britain’s EU exit.

“The continuity wasn’t there,” Mr. Robertson said.

The inexperience of Britain’s trade negotiators is highlighted when compared to the Canadian team—led by chief negotiator Steve Verheul—that has negotiated CETA, the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), and the new NAFTA deal, among other smaller free trade deals. Doug Forsyth, a director general of market access co-ordination at Global Affairs Canada, will take the technical lead in future talks with Britain, trade observers say. Mr. Forsyth was previously a director of trade negotiations at Agriculture and Agri-Food Canada.

“What Canada has done since the late ’80s is invest in having a cadre of very smart [and] knowledgable people on all aspects of trade,” Mr. Miller said.

This is an area of Canadian competence and expertise,” Mr. Robertson said. “And in tough negotiations, I do think that makes a difference.”

Mr. Miller said “a number” of Canadians have been offered positions on the British team, but turned them down due to an inadequate salary being offered. Mr. Robertson said Britain tried to hire one of Canada’s “most senior” trade negotiators.

Other prominent Canadians have publicly offered their assistance to the British government. Former prime minister Stephen Harper tweeted on June 29 that he would be “willing to assist whoever serves as the next leader of the UK Conservative Party on trade matters, should they wish. There is a lot to learn from Canada’s strong record in this area.” Former interim Conservative Party leader Rona Ambrose also said she was ready to help, after British media reported that she was among those recruited by U.K. Conservative leadership hopeful Jeremy Hunt.

Crawford Falconer has been Britain’s chief trade negotiation adviser since 2017. He previously served as New Zealand’s chief negotiator.

Mr. Cary said compiling a “battalion” of trade negotiators can’t be done in short order, and in the meantime they have brought in “expensive trade consultants.”

Peter Clark, a trade-focused consultant at Grey, Clark, Shih, and Associates and a former trade official for the Canadian government, said using the inexperience of the British side would be an “easy excuse” as to why talks have been slow to develop.

He added that it doesn’t matter how experienced a trade team could be if the politicians get involved.

“When we did NAFTA 2, we had really, really experienced people and the shots were being called by the politicians, and we got a pretty lousy deal,” Mr. Clark said.

He said if both sides of a trade teams are experienced, it is easier procedurally to negotiate a deal. If one side is more inexperienced it will take more time to educate the other.

“It’s not pulling the wool over their eyes.”