Brexit: Boris Johnson’s promise of lucrative trade deals in trouble, study warns

PM vowed to ‘take back control’ – but dithering has handed advantage to countries on other side of the table, Institute for Government says

Boris Johnson’s promise of lucrative post-Brexit trade deals as the UK “takes back control” of its rules is on course to fail, a study warns today.

Three years have been wasted failing to agree what Britain wants from its negotiations, the Institute for Government finds – handing the advantage to countries on the other side of table.

It means the controversy over the US demand to sell its chlorinated chicken – which has stalled a deal with Washington – will be repeated, its report concludes.

The think tank criticises the “unforced error” of launching into complex trade talks before ministers have decided what they want their post-Brexit regulations to be.

“Three years ago, we warned that the government had not set up the necessary structures for effective decision making on key trade policy issues,” said Maddy Thimont Jack, a senior researcher.

“The government did not heed that warning then, but it now needs to move urgently to put them in place. Otherwise it will find itself losing control of trade and regulatory policy to better-prepared partners.”

The criticism comes as trade talks with the EU remain deadlocked because the government cannot agree its future state aid rules and needs to satisfy Brussels’ fears of undercutting.

Hopes of a deal with the US this year have been abandoned – and even a revamped deal with Japan has run into trouble, in a row over access for UK agricultural products.

Notoriously, Brexit-backing Conservatives claimed it would be easy to strike numerous lucrative deals with other countries, once the UK was free to negotiate alone.

“The only thing we have to fear is fear itself,” Mr Johnson said before the 2016 referendum. “I think there is a huge opportunity. Do free trade deals, believe in ourselves.”

In fact, a deal with the US, even if it can be struck, would add only 0.2 per cent to GDP in the long run, the Treasury has estimated – and a continued deal with Tokyo only 0.07 per cent.

The IfG study, Trade and Regulation after Brexit, says it will be impossible to marry the desire for a clutch of new agreements and for “regulatory autonomy” – because a weakened UK will be told to change its standards in return.

It warns ministers that the UK:

* Could “easily fall victim” to other nations “threatening to collapse the talks if they do not get what they want”.

* Will be “vulnerable to challenge” at the World Trade Organisation, if its currently dysfunctional dispute system becomes operational again.

* Has failed to agree its stance on key regulatory issues, which risks it being “pushed into making concessions it shouldn’t”.

* Risks damaging the union, unless it can reach agreement with the other UK nations, which are responsible for implementing trade deals and “could choose not to”