Ursula von der Leyen says both sides will have to "prioritise" which elements are negotiated before the end of 2020
It’s “basically impossible” to sort out a complete trade deal with the UK in 2020, European Commission president Ursula von der Leyen said on Wednesday, in a speech given at her alma mater, the London School of Economics.
The one-year timeframe set by UK prime minister Boris Johnson for negotiating a new trade relationship is “very, very tight” and without an extension beyond 2020, which Johnson has firmly ruled out, “you cannot expect to agree everything. We will have to prioritise,” von der Leyen said.
In reality, the UK has “nine to 10 months at most” to get a deal in time for it to be ratified by December 31.
The UK will leave the EU at the end of the month but will then enter a transition period, ending in December, during which the two sides will try to agree on the terms of a future relationship.
The divorce agreement struck between the EU and UK says that this transition period can be extended by up to two years if both sides agree, but a decision must be made before July.
Urging “collaboration over isolation”, von der Leyen reiterated that UK researchers could continue applying to the EU’s Horizon 2020 research programme until it expires at the end of the year.
“But the future [arrangement] is subject to negotiations,” she said. And despite calling to preserve a strong security and defence partnership with the UK after Brexit, the president wouldn’t say if the country will have access in the future to EU defence research funds. “We’re in the process of defining rules for third countries,” she said.
In a sign that Brussels wants to take some of the heat out of this round of negotiations with the UK, von der Leyen stressed that both sides would “still be the best of friends and partners on February 1.” However, she added, “our partnership cannot and will not be as close as before.”
She also warned the UK that regulatory divergence with Brussels would mean “more distance” with Europe, and inevitable barriers for British companies trading in Europe. The UK government has indicated it wants to break with EU rules and regulations.
“Without the freedom of movement of people, you cannot have the free movement of capital, goods and services. Without a level playing field on environment, labour, taxation and state aid, you cannot have the highest-quality access to the world’s largest single market,” the president said.
However, von der Leyen said that if EU terms are met, Brussels is ready to design a new partnership “unprecedented in scope” that included “zero tariffs, zero quotas, and zero dumping”.