That might sound like a long time away, but it’s not. “The two-year negotiation timetable is clearly too short for Britain,” Moody’s Analytics says in a new report. Here’s a short list of what the UK must do in that time window:
– Negotiate a new trade deal with the European Union. – Negotiate trade deals with more than 50 other nations
– including the United States and China – that have trade agreements with the EU, since the UK will no longer be governed by those deals.
– Establish “passporting rights” that allow the UK’s thriving financial services industry to operate seamlessly with the rest of Europe, as it does now.
– Make a deal determining the fate of two million Brits living in other EU nations, along with three million EU migrants living in Britain.
Anybody who thinks all of this will be easy never negotiated a trade deal, which typically takes 4 to 5 years to put in place. Multiply that by 50 and you get some idea of the daunting work the UK must accomplish in a short amount of time.
This is why Brexit will be a nightmare for the UK - Yahoo Finance
There are models the UK can follow that might allow economic integration with Europe, without adherence to its immigration rules and other requirements Brexit voters strongly objected to. Iceland, Liechtenstein and Norway, for instance, essentially pay a fee to the EU to enjoy trading privileges in the common market. But the fees in Norway, the nearest analog to the UK, are almost as high as what the UK pays to the EU now, and Norway has no say at all in EU decisions. This arrangement “would not generate substantial fiscal savings for the UK government,” according to a recent analysis by the London School of Economics and Political Science. Since UK payments to the EU were one of the primary objections of Brexit voters, this option seems to violate the spirit of Brexit.
Switzerland has a different deal with the EU and pays about 60% less than the UK does, but “the Swiss model would result in less economic integration… leading to higher economic costs of Brexit,” according to the LSE paper. Then there’s the Canadian model, which allows the free flow of goods but is not as open regarding services, including finance, which would deal a blow to the UK banking sector, a key competitive advantage of the UK economy.
This is why Brexit will be a nightmare for the UK - Yahoo Finance