British Prime Minister Boris Johnson is mulling to use the threat of high tariffs to raise pressure on the EU, the US and other nations to strike trade deals with Britain, the Times newspaper reported yesterday.
Johnson and his Cabinet ministers discussed using tariffs as “leverage” in an effort to accelerate trade talks at a meeting this week which could result in taxes of 30 percent on some types of French cheese and 10 percent on German cars, the newspaper reported.
In an EU exit strategy committee meeting on Thursday, ministers agreed that the tariffs should be put out for consultation, according to the report.
Photo: Reuters
Ministers also agreed to prioritize Japan, US, Australia and New Zealand as “tier one” countries in negotiations and other countries as “tier two,” the newspaper added.
The UK will largely replicate the EU tariff schedule which will be published and lodged at the WTO, according to the newspaper.
Johnson will lay out the negotiating plan in the first week of next month, the report added, citing officials from Brussels.
US Treasury Secretary Steven Mnuchin said on Friday that the US wants to conclude a trade deal with Britain this year.
Britain is to leave the EU on Friday.
German Minister of Finance Olaf Scholz said he is confident that his country would not suffer from Brexit, but that Britain will inevitably face “consequences” from its decision to leave the EU.
At a panel at the World Economic Forum, Scholz said Britain’s financial sector would not be as important to the EU after Brexit as it is now.
Britain is set to leave the EU in less than a week, but is to remain within its tariff-free single market and customs union until the end of the year to smooth its exit.
Scholz said a non-member cannot have the same advantages as an EU member and that will be an important factor in trade discussions between the EU and Britain.
“That is something that will have to be balanced,” he said. “I think we will have solutions but, sure, there cannot be a special competitive advantage from being outside.”
Britain’s Chancellor of the Exchequer Sajid Javid said this week he is confident that a comprehensive trade deal with the EU covering goods and services can be negotiated by the end of this year. Many trade experts think that is optimistic, as trade deals usually take years to thrash out.
Additional reporting by AP
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