Canada and the United Kingdom have agreed to a so-called rollover trade deal, the countries announced in a video conference on Saturday, promising to negotiate a more comprehensive economic agreement after the UK’s post-Brexit transition period ends.
The UK-Canada rollover deal allows provisions from the Canada-European Union Comprehensive Economic and Trade Agreement that specifically cover trade between the two countries to continue once Britain leaves the EU. The new agreement will provide continued access to the benefits of CETA on a bilateral basis, including the elimination of tariffs on 98% of Canadian products exported to the UK.
“This is a good moment,” Prime Minister Justin Trudeau declared in a video call with his UK counterpart Boris Johnson and the two countries’ respective trade ministers to affirm the “agreement in principle” reached “to make sure that our businesses and yours continue to work well together.”
Trudeau stressed the importance of maintaining strong ties to the UK, which he noted is Canada’s fifth-largest trading partner globally and its top partner in Europe.
The Canada-UK Trade Continuity Agreement still needs to undergo legal checks before it is officially signed, the UK government said. The deal must also be approved by the Canadian Parliament before it can come into effect. The House of Commons is scheduled to sit for 14 more days before it breaks for recess on December 11.
While recently expressing hope the two sides should be able to agree on an “easy” trade deal by the end of the year, Trudeau had cautioned that Britain’s “bandwidth” for negotiations was a challenge as it attempts to strike deals with several major trade partners at the same time.
In a statement, the British government said negotiations would begin next year on a comprehensive agreement with Canada.
Trudeau suggested that such a deal with the UK would take several years to negotiate. “Now we get to continue to work on a bespoke agreement, a comprehensive agreement over the coming years that will really maximize our trade opportunities and boost things for everyone,” he said.