Canada and the United Kingdom have agreed to a rollover trade deal, the countries announced on Saturday, promising to negotiate a more comprehensive agreement after the UK’s post-Brexit transition period ends.
Britain is preparing to complete its departure from the European Union by the end of December and it has negotiated dozens of bilateral agreements as part of its effort to maintain trade and mitigate any potential economic effects from Brexit.
The UK-Canada rollover deal allows provisions from the Canada-European Union Comprehensive Economic and Trade Agreement (CETA) that pertain specifically to trade between the two countries to continue, CBC News reported.
“This is a good moment,” Canadian Prime Minister Justin Trudeau said during a video call with his UK counterpart Boris Johnson and the two countries’ respective trade ministers, which was shared on social media.
Trudeau said the deal, dubbed the Canada-UK Trade Continuity Agreement, is “to make sure that our businesses and yours continue to work well together”.
British businesses export everything from electric cars to sparkling wine to Canada, and today’s deal will ensure that trade goes from strength to strength. 🇬🇧🇨🇦 pic.twitter.com/3Ulmva0GLi
— Boris Johnson (@BorisJohnson) November 21, 2020
He stressed the importance of maintaining strong ties to the UK, which he said is Canada’s fifth-largest trading partner globally and its top partner in Europe.
In a statement, the British government said negotiations would begin next year on a comprehensive agreement with Canada.
In the meantime, the rollover agreement “locks in certainty for UK businesses trading goods and services with Canada” worth about $35bn (£20bn), it said.
“This is a fantastic agreement for Britain which secures transatlantic trade with one of our closest allies,” Johnson said in the statement.
“British businesses export everything from electric cars to sparkling wine to Canada, and today’s deal will ensure that trade goes from strength to strength.”
The deal still needs to undergo legal checks before it is officially signed, the UK government said.
On Canada’s side, it must be approved by Parliament before it can come into effect, CBC News reported.
The UK has pushed to sign bilateral trade deals ahead of its departure from the EU to mitigate any potential negative economic effects from Brexit.
Britain is currently engaged in discussions with the EU to set the terms of their future trading relationship for when the post-Brexit transition period ends on December 31.