British Prime Minister Boris Johnson answers questions during a media conference at an EU summit in Brussels, Thursday, Oct. 17, 2019. Britain and the European Union reached a new tentative Brexit deal on Thursday, hoping to finally escape the acrimony, divisions and frustration of their three-year divorce battle. (AP Photo/Francisco Seco)

Canadian business needs Brexit certainty but Johnson plan only a start: observers

The outcome of the unusual weekend vote in London is itself far from predictable

Experts warn that a post-Brexit United Kingdom will present Canadian business with tremendous uncertainty about billions of dollars worth of trade and investments, no matter how the British Parliament votes on Saturday.

The outcome of the unusual weekend vote in London is itself far from predictable, as British Prime Minister Boris Johnson struggles to get support for a controversial agreement that he reached Thursday with the European Union.

But observers say even a Johnson success would only provide a starting point for further rounds of difficult negotiations between London and Brussels and eventually between Canada and the United Kingdom.

Fasken partner Clifford Sosnow says the primary benefit of Johnson’s plan is that it would provide for 14 months to 36 months of negotiations on a new trade deal for two of Canada’s biggest export and investment markets.

“The major concern for everybody is the instability and the instability from not knowing what the business relationship will be, what the investment relationship will be,” says Sosnow, who provides strategic advice about international trade and investments at one of Canada’s largest business law firms.

He adds that open talks between the United Kingdom and Canada would be allowed only after the U.K. leaves the European Union on Oct. 31, if Johnson’s schedule is passed by the British House of Commons.

ALSO READ: Brexit hard-liner Boris Johnson wins race to become UK’s next prime minister

The United Kingdom by itself, represents one of Canada’s top five destinations for investments and top 10 markets for goods and services.

It has also been a gateway for Canadian companies that do business in the European Union, which is Canada’s second- or third-biggest trading partner after the United States and China, depending on the measure.

About 40 per cent of Canadian trade in merchandise with the EU goes through United Kingdom, says Achim Hurrelmann, a political scientist and co-director of Carleton University’s Centre for European Studies in Ottawa.

Without a good free-trade deal between Brussels and London, companies may reconsider “whether they want to stay in the United Kingdom or … go to Dublin (Ireland), or to France or to Germany or the Netherlands.”

“To some extent, that has already happened but my impression is that most companies have been staying put and observing and waiting (to see) what is happening,” Hurrelmann says.

He says that Johnson’s proposed deal would provide more time to sort out the U.K.’s trade relationship with the EU but also with Canada.

“Canada wants to have a trade deal with the U.K. and the U.K. wants to have one with Canada as well,” Hurrelmann says.

“But the question, of course, is will we have time to actually work that out properly or will that have to be very rushed after a no-deal Brexit.”

Mark Camilleri, a Brussels-based Canadian at the Canada EU Trade and Investment Association, says he thinks it’s fair to say “that having any deal is better than having no deal” if only to reduce uncertainty.

He says that having no U.K.-EU. deal “it would potentially be very destabilizing for businesses, including Canadian businesses that are not just based in the U.K. but also based in the EU that are trading to the U.K.”

But Camilleri noted the British Parliament has rejected Theresa May’s proposals on three occasions so ’one has to hold one’s breath as to whether or not (Johnson’s deal) will get through.”

David Paddon, The Canadian Press

Like us on Facebook and follow us on Twitter.

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Work begins on new affordable housing building in Nelson

The 39-unit project is expected to be complete by July 2021

‘I knew what he wanted’: Man recalls black bear chasing him up tree in Slocan Valley

Francis Levasseur is no stranger to the outdoors, but a recent run-in with a bear caused quite a scare

No passenger flights at West Kootenay Regional Airport until at least September

This is the third time Air Canada has announced changes to flight operations out of the airport

Morning Start: 180 different bird species exist in Kootenay National Park

Here is your Kootenays’ morning start for Friday, May 29

QUIZ: Test your knowledge of the world of summer sports

In a typical year, there are plenty of summer sporting events and tournaments held across Canada

Help the Nelson Star continue its mission to provide trusted local news

Black Press is now accepting donations to keep its papers operating

‘We’re sick of it’: Anger over police killings shatters U.S.

Tens of thousands marched to protest the death of George Floyd

Join Kootenay family in virtual walk for Ronald McDonald House

“We always described it as our oasis in the middle of the desert,” Brigitte Ady shares.

Surrey mayor’s party under fire for ‘sickening’ tweet accusing northern B.C. RCMP of murder

Mayor Doug McCallum says tweet, Facebook post ‘sent out by unauthorized person’

Father’s Day Walk Run for prostate cancer will be virtual event this year throughout B.C.

The annual fundraiser for Prostate Cancer Foundation BC has brought in $2.5 million since 1999

Dr. Bonnie Henry announces official ban on overnight kids’ camps this summer

New ban comes after talking with other provincial health officials across the country, Henry says

Senior man in hospital after unprovoked wolf attack near Prince Rupert

Conservation officers are on site looking for the wolf

VIDEO: NASA astronauts blast off into space on SpaceX rocket

Marks NASA’s first human spaceflight launched from U.S. soil in nearly a decade

Most Read