British Prime Minister Boris Johnson answers questions during a media conference at an EU summit in Brussels, Thursday, Oct. 17, 2019. Britain and the European Union reached a new tentative Brexit deal on Thursday, hoping to finally escape the acrimony, divisions and frustration of their three-year divorce battle. (AP Photo/Francisco Seco)

British Prime Minister Boris Johnson answers questions during a media conference at an EU summit in Brussels, Thursday, Oct. 17, 2019. Britain and the European Union reached a new tentative Brexit deal on Thursday, hoping to finally escape the acrimony, divisions and frustration of their three-year divorce battle. (AP Photo/Francisco Seco)

Canadian business needs Brexit certainty but Johnson plan only a start: observers

The outcome of the unusual weekend vote in London is itself far from predictable

Experts warn that a post-Brexit United Kingdom will present Canadian business with tremendous uncertainty about billions of dollars worth of trade and investments, no matter how the British Parliament votes on Saturday.

The outcome of the unusual weekend vote in London is itself far from predictable, as British Prime Minister Boris Johnson struggles to get support for a controversial agreement that he reached Thursday with the European Union.

But observers say even a Johnson success would only provide a starting point for further rounds of difficult negotiations between London and Brussels and eventually between Canada and the United Kingdom.

Fasken partner Clifford Sosnow says the primary benefit of Johnson’s plan is that it would provide for 14 months to 36 months of negotiations on a new trade deal for two of Canada’s biggest export and investment markets.

“The major concern for everybody is the instability and the instability from not knowing what the business relationship will be, what the investment relationship will be,” says Sosnow, who provides strategic advice about international trade and investments at one of Canada’s largest business law firms.

He adds that open talks between the United Kingdom and Canada would be allowed only after the U.K. leaves the European Union on Oct. 31, if Johnson’s schedule is passed by the British House of Commons.

ALSO READ: Brexit hard-liner Boris Johnson wins race to become UK’s next prime minister

The United Kingdom by itself, represents one of Canada’s top five destinations for investments and top 10 markets for goods and services.

It has also been a gateway for Canadian companies that do business in the European Union, which is Canada’s second- or third-biggest trading partner after the United States and China, depending on the measure.

About 40 per cent of Canadian trade in merchandise with the EU goes through United Kingdom, says Achim Hurrelmann, a political scientist and co-director of Carleton University’s Centre for European Studies in Ottawa.

Without a good free-trade deal between Brussels and London, companies may reconsider “whether they want to stay in the United Kingdom or … go to Dublin (Ireland), or to France or to Germany or the Netherlands.”

“To some extent, that has already happened but my impression is that most companies have been staying put and observing and waiting (to see) what is happening,” Hurrelmann says.

He says that Johnson’s proposed deal would provide more time to sort out the U.K.’s trade relationship with the EU but also with Canada.

“Canada wants to have a trade deal with the U.K. and the U.K. wants to have one with Canada as well,” Hurrelmann says.

“But the question, of course, is will we have time to actually work that out properly or will that have to be very rushed after a no-deal Brexit.”

Mark Camilleri, a Brussels-based Canadian at the Canada EU Trade and Investment Association, says he thinks it’s fair to say “that having any deal is better than having no deal” if only to reduce uncertainty.

He says that having no U.K.-EU. deal “it would potentially be very destabilizing for businesses, including Canadian businesses that are not just based in the U.K. but also based in the EU that are trading to the U.K.”

But Camilleri noted the British Parliament has rejected Theresa May’s proposals on three occasions so ’one has to hold one’s breath as to whether or not (Johnson’s deal) will get through.”

David Paddon, The Canadian Press

Like us on Facebook and follow us on Twitter.

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Kelowna City Hall. (Michael Rodriguez - Capital News)
No public attendance for Kelowna council meetings, public hearings

The new measures come as part of the new provincial order, released on Dec. 3

Robert Riley Saunders. (File)
Former Kelowna social worker arrested for allegedly stealing from foster children

Robert Riley Saunders was arrested in Alberta and will be brought back to B.C. to face charges

Townhouse proposals by Westcorp to the City of Kelowna, up for consideration Monday, Dec. 7. (City of Kelowna/Westcorp)
Kelowna council to decide on Westcorp development permit for Hiawatha RV Park

City of Kelowna council will consider Monday whether to issue a development permit for the project

Two Kelowna flights have been flagged as having COVID-19 cases on board. (Black Press Media file photo)
COVID-19 cases on several Kelowna flights

The flights were on Nov. 19, 22, 24 and 27, according to the BC Centre for Disease Control

This microscope image made available by the National Cancer Institute Center for Cancer Research in 2015 shows human colon cancer cells with the nuclei stained red. On Friday, May 29, 2020, doctors are reporting success with newer drugs that control certain types of cancer better, reduce the risk it will come back and make treatment simpler and easier to bear. (NCI Center for Cancer Research via AP)
Vernon families give $200,000 towards cancer care in Kelowna

First ever chair in brachytherapy supported by Popowich and Bannister families

JoeAnna’s House pictured in 2019. The house has been in operation for a year. (Twila Amato - Black Press Media)
JoeAnna’s House celebrates its one-year anniversary

It’s been one year since JoeAnna’s House opened its doors to helping families

British Columbia Health Minister Adrian Dix wears a face mask to curb the spread of COVID-19, during an announcement about a new regional cancer centre, in Surrey, B.C., on Thursday, August 6, 2020. THE CANADIAN PRESS/Darryl Dyck
PHSA bought faulty ventilators; spent money on catering, renovations: Dix

Such spending included ‘unnecessary, unbudgeted renovations’ to the authority’s headquarters in Vancouver

B.C. NDP leader John Horgan releases his election platform, Vancouver, Oct. 6, 2020, featuring COVID-19 relief payments promised for most households. (B.C. NDP photo)
Next $1.5 billion in B.C. COVID-19 cash ‘prudent,’ Horgan says

New round of paymens for household incomes up to $175,000

Numerous businesses, including the Roxie movie theater, have closed to try and stop spread of COVID-19. (Liam Harrap/Revelstoke Review)
Revelstoke COVID-19 cases tick slowly up to 49

An increase of only three cases since Nov. 30

KIJHL games have been postponed through Dec. 31. (File photo)
KIJHL postpones all games through end of 2020

Due to provincial health orders, games up to Dec. 31 have been pushed back

The Grinch was stolen Wednesday and returned sometime in the night on Friday. (Hughes photo - Facebook)
The Grinch has been returned to Penticton home

“I guess someone’s heart grew three times that night” says April Hughes

An Armstrong resident shared video of a beaver gnawing away on a stick to Facebook Friday, Dec. 4, 2020. (Robyn Civic Adnoh photo)
WATCH: Beaver gnaws away in Armstrong wetlands

A resident captured video of a beaver chewing happily in a local creek Friday

Cannabis bought in British Columbia (Ashley Wadhwani/Black Press Media)
Is it time to start thinking about greener ways to package cannabis?

Packaging suppliers are still figuring eco-friendly and affordable packaging options that fit the mandates of Cannabis Regulations

Greater Vernon Chamber of Commerce’s Vote Vernon initiative, presented by VantageOne Credit Union, calls on residents to shop local this Christmas season. (Black Press file)
Small businesses hurt by federal COVID-19 response: North Okanagan-Shuswap MP

Mel Arnold calls for more accessible programming for businesses; supports local holiday shopping

Most Read