Britain is heading into uncharted territory as for the first time in over 40 years, it becomes an independent nation outside of the EU Custom’s union. Since the 2016 referendum, Britain has been debating with itself on what future it wants to have outside of the European Union. And with Boris Johnson’s comfortable election victory last December, it’s clear that the country has moved on, and decided to leave the EU.
Despite the pandemic and the massive economic cost, Britain will not delay its departure from the EU and will be an independent coastal state starting January 1st 2020. With that comes significant hurdles to business from tariffs to VAT. And it’s clear there won’t be enough time to implement all the necessary measures to avoid disruption, where there will be many cross-border businesses that struggle with the new regulations and added red tape. But the opportunity for Britain to trade independently provides it with some unique prospects with more than 70 other nations.
Regardless of whether there is a trade agreement with the EU, the UK is a large economy with a 65 million+ population on the doorstep of Europe. Prior to the pandemic, unemployment was below 4% and exports were at near record levels. But one key area of Britain’s trading relationship has been the large imbalance. Running huge trade deficits every year with countries like France and Germany, Britain has an opportunity to rebuild its manufacturing base, and forge closer trading relationships with Commonwealth nations including Australia, Canada and India.
Will Britain be able to turn the tide and promote global free trade?