David Davis warns EU it cannot 'cherrypick' Brexit trade deal with Britain

  • Britain to warn the EU it cannot “cherrypick” what it wants in trade deal with UK.
  • UK government does not accept that goods and services can be separated, according to reports.
  • Michel Barnier has warned Britain it cannot “cherrypick” best parts of current trade deals.
  • Cabinet will meet on Tuesday to discuss Brexit endstate.

LONDON – Brexit Secretary David Davis is set to warn the European Union that it cannot “cherrypick some sectors” in a free trade relationship with Britain.

David will tell Brussels that the UK government views goods and services as inseparable and does not agree that Britain must accept a limited trade deal without services unless it stays in the single market and customs union after Brexit, government officials have told the Guardian.

“They [the EU] either want to have a broad economic relationship with the UK, or they don’t,” a Whitehall source said.

This comes in response to Michel Barnier interview for Prospect Magazine in which the EU’s chief Brexit negotiator warned Theresa May that there will be no “cherry picking” in trade negations between the bloc and Britain.

“We won’t mix up the various scenarios to create a specific one and accommodate their wishes, mixing, for instance, the advantages of the Norwegian model, member of the single market, with the simple requirements of the Canadian one,” Barnier said.

“No way. They have to face the consequences of their own decision.”

However, the UK Brexit Department is adamant that it will not have to choose between staying inside the single market and customs union or a simple free trade arrangement excluding services.

“We are regularly approached by foreign governments and businesses who tell us that they want a fully functioning economic relationship with Britain which goes beyond the more rigid and unambitious suggestions from the commission,” a government source cited by the Guardian claimed.

Ministers including Davis believe that EU members like Ireland, Belgium and Netherlands have no interest in forcing Britain into a limited trade arrangement with the EU as the UK is an important market for their economies.

Economic experts and MPs have warned Davis that a trade deal not including services, such as the Canada-EU free trade deal (CETA), would be disastrous for Britain as services make up around 80% of UK economy.

Labour MP Chuka Umunna told BI that a Canada-style deal would be “terrible” for Britain in a recent interview.

Cabinet to finally discuss Brexit end-state

The prime minister and her Cabinet will meet on Tuesday to discuss what they want the outcome of Brexit negotiations to be.

May’s top team is divided between ministers who want to see Britain diverge from the EU after Brexit, like Davis, Boris Johnson and Michael Gove, and those who want to see Britain remain closer to Brussels, led by Chancellor Philip Hammond and Amber Rudd.

The PM told MPs on Monday that she will make “rapid” progress in negotiating a transition deal with the EU in the New Year.

May said the government would quickly seek to negotiate a two-year transition deal, on the same trade and customs terms as the UK currently enjoys with Europe,” adding that talks would begin “very soon.”

“As I proposed in Florence, during this strictly time-limited implementation period which we will now begin to negotiate, we would not be in the Single Market or the Customs Union, as we will have left the European Union,” she said.

However, she added that Britain will still continue to follow the rules of the single market and customs union throughout that period.

“But we would propose that our access to one another’s markets would continue as now, while we prepare and implement the new processes and new systems that will underpin our future partnership.”

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.