The agreement reached with Australia this week is celebrated by the UK government as a landmark trade deal – the first that isn’t a rollover of old European Union membership terms. But that honour surely belongs to a treaty that was signed by Boris Johnson in December 2020. It is the trade and cooperation agreement (TCA) covering the exchange of goods between Britain and 27 other nations.
But those nations constitute the European single market, which Mr Johnson does not appear to count as a valuable trading partner, despite its proximity.
Disruption caused by the pandemic makes it hard to measure the impact of Brexit. Treasury analysis from 2018 estimated the long-term cost of a deal along the lines of the one concluded by Mr Johnson at around 5% of GDP. In March this year, the Office for Budget Responsibility estimated that the fall in trade with the EU under the TCA would shave around 0.5% from GDP in the first quarter of 2021. And that is at a time when “grace periods” are still easing border friction. » | Editorial | Wednesday, June 16, 2021
