Boris Johnson cheers after the deal was agreed in a conference call with Ursula von der Leyen (pic: Downing Street)
Prime Minister Boris Johnson delivered some Christmas cheer to the nation today by announcing a Brexit deal that will end four and a half years of agonising negotiations with the EU.
He described it as a ‘jumbo Canada-style’ deal and declared: “All our red lines about returning sovereignty have been achieved.
“Everything that the British public were promised during the 2016 referendum and in the general election last year is delivered by this deal.
“The deal is fantastic news for families and businesses in every part of the UK. We have signed the first free trade agreement based on zero tariffs and zero quotas that has ever been achieved with the EU.”
Ursula von der Leyen announcing the deal in Brussels
Final details over fishing rights and the level playing-field over regulation and competition rules were thrashed out by diplomats from both sides.
Crucially, it will avoid huge disruption on top of the coronavirus crisis.
Defending concessions on fishing rights, Mr Johnson said the country would now have “prodigious quantities” of more fish and hinted at subsidies for the industry to boost catches.
European Commission president Ursula von der Leyen said the EU had achieved “five-and-a-half years of predictability for our fishing communities”.
She added that on issues such as climate change the EU and the UK will stand “shoulder to shoulder to deliver on our common global goals”.
Michel Barnier, the EU’s chief negotiator said “the clock is no longer ticking”. He added: “Today is a day of relief but also sadness.”
The EU’s 27 states will be required to sign off the deal.
The agreement will be put before the UK parliament next week enabling tariff-free trade to begin on 1 January. The UK will leave the single market and the customs union but the deal will preserve its zero-tariff and zero-quota access to the bloc’s single market of 450 million consumers.
Sir Keir Starmer: ‘option of a better deal has gone’
Labour leader Sir Keir Starmer said this evening that Labour would support the deal after he rejected calls for the party to abstain.
“At a moment of such national significance, it is not credible for Labour to be on the side lines,” he said.
“That is why I can say today that when this deal comes before Parliament, Labour will accept it and vote for it.
“But let me be absolutely clear – and say directly to the Government – up against no deal, we accept this deal, but the consequences of it are yours.”
He said it does not provide adequate protections for British manufacturing, financial services, creative industries, or workplace rights and said there are serious questions about the Government’s preparedness for the new arrangements.
“A better deal could have been negotiated. But I accept that option has now gone.”
Nicola Sturgeon, Scotland’s First Minister, responded to the deal by saying Scotland’s future is as an independent country within the EU.
Nigel Farage declared that the deal represented victory for the people over the politicians.
Nigel Farage: victory for the people (pic: Terry Murden)
The leader of the Brexit Party said that history had been made and that Boris Johnson would be known as “the man that finished the job”.
On Twitter he said: “However unhappy I might be about some of the detail, in 100 years time, kids in school will read that the people beat the politicians.”
Britons took to social media to respond to the announcement with the usual mix of hostility and humour. One described it as a “Christmas ‘miracle”, while another, referring to the drawn out talks on fishing, declared: “Merry Fishmas everyone”.
The stock market closed before the deal was announced but failed to get excited about the prospect of an agreement. The FTSE 100 was just 6.36 points higher at 6,502.11 in a truncated trading session ahead of the Christmas break.
Britain’s biggest banks, Lloyds Banking Group, Barclays and Natwest, gained between 2% and 4.5% on hopes that the long-elusive deal would brighten the country’s economic prospects in 2021.
How did business respond?
Tony Danker, CBI Director-General
“We congratulate David Frost, Michel Barnier and their teams for this landmark achievement, and we praise the courage of our political leaders in reaching a deal.
“This will come as a huge relief to British business at a time when resilience is at an all-time low. But coming so late in the day it is vital that both sides take instant steps to keep trade moving and services flowing while firms adjust.
“Firms will immediately study the details, when they can, to understand the implications for their companies, customers and clients but immediate guidance from government is required across all sectors.
“Above all, we need urgent confirmation of grace periods to smooth the cliff edge on everything from data to rules of origin and we need to ensure we keep goods moving across borders.
“The UK has a bright future outside the European Union and with a deal secured we can begin our new chapter on firmer ground.”
David Lonsdale, Director of the Scottish Retail Consortium
“The securing of a tariff-free trade agreement between the UK and EU is positive news. It will protect Scottish consumers from hundreds of millions of pounds of import tariffs on everyday goods, and help retailers to keep down prices at a time when the economy is under enormous pressure. Given that four-fifths of food imports come from the EU, this announcement should afford Scots households a collective sigh of relief.
David Lonsdale: ‘crucially important step’ (pic: Terry Murden)
“The UK and EU governments have taken a crucially important step in agreeing a zero-tariff agreement, to the benefit of customers. They must now work to implement this new arrangement as soon as possible, and seek to minimise the checks and red tape on imports that are expected from January onwards.
British Chambers of Commerce Director General Adam Marshall
“While firms will welcome the agreement of a new foundation for UK-EU trade, they are now faced with the gargantuan task of adapting to new arrangements with scarcely a week before they take effect.“
Jonathan Geldart, Director General of the Institute of Directors
“Digesting what the changes mean in practice and adapting, in the middle of a pandemic and the festive season while border disruptions continue, is a huge ask.
“Wherever possible, changes should be phased in. Financial support for SMEs, such as vouchers for professional advice or tax reliefs to help them adjust, would help firms get on the front foot for the new year.”
James Withers, Chief Executive of Scotland Food & Drink
“A deal has emerged ridiculously late in the day and there is a huge amount of detail to assess. However, this will ensure we avoid crippling tariffs of up to 80% on some of our key food exports. That is good news.
“However, before Ministers start popping champagne corks, they need to be alive to the danger of more disruption at our ports in just a few days’ time.
“The tariff threat is averted but we remain hugely concerned at the wave of new export checks about to be introduced. For months now we have been warning the UK Government of disruption and a lack of readiness. We have lost a transition period to a pandemic and it is only with a week to go that we now know what we are transitioning to.
“We would urge the UK Government to now seek a grace period on the introduction of new export checks on 1 January. The UK is already planning to waive checks on most imports from the EU and on some products moving between Northern Ireland and the GB mainland.
“We desperately need the same for our exports to the continent. Otherwise I fear the scenes we have witnessed of horrendous border disruption over recent days could be repeated, especially with new Covid testing now also required.
James Withers: ‘we now need a grace period’ (pic: Terry Murden)
“Businesses cannot afford more disruption after a nightmare year and a Christmas export trade that has been ruined for many. If they face more losses through no fault of their own, UK Government will have to be ready with financial aid.
“With four working days until the end of the year, there are around 2000 pages of detail to analyse. There is already grim news emerging for seed potato exports to Europe, important to Scotland’s farmers. They now look blocked from 1 January. The phrase ‘free trade’ certainly won’t apply to them.”
Food and Drink Federation chief executive Ian Wright
“UK food and drink is breathing a sigh of relief that we have a deal but we will hold the celebrations until we have scrutinised the detail. We must first answer key questions about which individual sectors of the industry will be unable to access the EU market without facing tariffs under the agreed rules of origin.
“We welcome the prospect of a more constructive approach to enforcing new rules, on both sides of the border. We hope for a much more collaborative relationship between London and member states with the minimisation of disruption at the border due to new trade frictions introduced as a priority.
“The Prime Minister promised UK businesses over a year of transition in which to adapt to a new set of rules. He has delivered us four working days. Food and drink manufacturers will do their best to keep food flowing.
“However, this week’s chaos at Dover and the last gasp nature of this deal means that there will be significant disruption to supply and some prices will rise. Disappointed shoppers and consumers will rightly ask why a deal had to take so long.”
Federation of Small Businesses National Chairman Mike Cherry
“After such a torrid year, and during such a disrupted festive trading season, it’s a huge relief to see negotiators finally strike a deal.
“The work of looking through the detail of the agreement to map out exactly what it means for the small firms that make-up 99% of our business community now begins.
“As well as going through the terms of access to each other’s markets, we are keen to see the Small Business Chapter that we have championed and encouraged both sides to include.
“What we need from here is tangible, targeted support, including £3,000 transition vouchers that small firms can spend on the training and advice required to navigate a new trading relationship with our biggest export market.”
Federation of Small Businesses Scotland policy chair Andrew McRae
“The end of the transition period will still result in a major change in trading conditions for many firms. Given that Scotland’s smaller firms have faced down an oppressive year, we need to see the UK Government help smaller operators with depleted case reserves adapt. That’s why we need to see a transition voucher scheme, as well as additional publicly funded support, rolled out as soon as possible.
Donna Fordyce, Chief Executive of Seafood Scotland
“This is a two-sided deal. Over the last few days we’ve seen the utter chaos that disruption at the Border causes. With Brexit will come new, untested, and extremely complex processes that the seafood sector will have to comply with in just a week’s time, at huge cost which they can ill afford just now.
“This bureaucratic blockade will result in some lorries not making it to Europe in time to ensure their highly perishable cargo is saleable.
“We expect it to be a good few months until everything beds in and in the meantime, seafood businesses will try their best to navigate the changes, but some will not survive.”
Farmers are unhappy that the seed potato market worth millions each year has been excluded from the deal.
Exports of seed potatoes will not benefit from free trade provisions because Brussels did not accept that the UK would remain “dynamically aligned” with EU standards on the product.
Sales to Northern Ireland will also be halted, as the province will operate under EU arrangements under the terms of last year’s withdrawal agreement.
The seed potato export market is worth an annual £90 million to the UK, with about 20% going to the EU and the majority grown in Scotland and the north of England.
On a more positive note, a trade deal will avoid the prospect of huge tariffs on beef and lamb exports which would have been imposed under World Trade Organisation terms.