Britain will not suffer major trade disruption even if it opts for a ‘hard’ Brexit, the head of the World Trade Organisation said today.
Roberto Azevedo said trade between the UK and EU member states ‘will not stop, it will continue’ and also vowed to help Britain secure a ‘fast and smooth’ divorce from the EU.
His comments will reassure those concerned that ministers will fail to reach agreement over Britain’s trade relationship with the EU within the two-year time limit for Brexit negotiations after Theresa May triggers Article 50.
Roberto Azevedo (pictured in an interview with Sky News today) said trade between the UK and EU member states ‘will not stop, it will continue’ and also vowed to help Britain secure a ‘fast and smooth’ divorce from the EU
The collapse in trade talks last week between the EU and Canada over a landmark trade deal after 10 years of negotiations have heightened fears that Britain would leave the EU without new trade agreements in place.
If no deal is reached over new trade terms with the EU, goods and services will be trade on WTO terms, which are seen as the most basic and the ones used for Russia’s trading relationship with Brussels.
But speaking today, Mr Azevedo said he promised to ensure the UK does not face a trade ‘vacuum or a disruption’ however tough its departure from the EU.
He told Sky News: ‘I will be working hard – I will work very intensely to ensure that this transition is fast and is smooth,’ he said.
‘The less turbulence the better. The global economy today is not in the best shape for us to be introducing turbulence.’
Theresa May (pictured leaving Downing Street today) has been told the World Trade Organisation will help to ensure Britain’s divorce from the EU is ‘as smooth as possible’
Asked whether the Brexit process will be disruptive for British firms and households, Mr Azevedo said: ‘I’m not saying there will be a vacuum.
‘The UK is a member of the WTO today, it will continue to be a member tomorrow. There will be no discontinuity in membership.
‘They have to renegotiate [their terms of membership] but that doesn’t mean they are not members.
Reassuring UK businesses, he added: ‘Trade will not stop, it will continue and members negotiate the legal basis under which that trade is going to happen. But it doesn’t mean that we’ll have a vacuum or a disruption.’
Mrs May has said she will trigger Article 50 by the end of March next year. It means Britain will be officially cut ties with Brussels by April 2019.
Mr Azevedo said he had told the British government that the WTO will be on hand to help Britain through the transition
‘I told [International Trade Secretary Liam Fox] that I myself and the WTO secretariat will be available to make the transition as smooth as possible,’ he said.
‘Then we have been in touch, not every day, but clearly there will be a very dynamic relationship in the future.’
Ukip said Mr Azevedo’s remarks proved warnings from Remain campaigners that Brexit would cause trade chaos by clogging up UK ports were wrong.
Patrick O’Flynn, Ukip MEP for the East of England, said: ‘Project Fear is in real trouble because the basic facts are on Britain’s side when it comes to international trade.
‘It is very encouraging to see Roberto Azevedo, the director general of the World Trade Organisation, make clear that it will be straightforward for Britain to resume its independent seat on that body and that there will be no seizing-up of international trade.
‘Britain is in a very strong Brexit negotiating position as the eurozone’s biggest global export market and also given our huge trade deficit with the EU as a whole.’
Patrick O’Flynn (pictured), Ukip MEP for the East of England, said: ‘Project Fear is in real trouble because the basic facts are on Britain’s side when it comes to international trade
He added: ‘A recent Civitas study showed that even if WTO regime tariffs were adopted rather than free trade with the EU, Britain would raise £8bn more in import duties than would be levied by the EU on our exporters, meaning we could easily compensate such companies anyway.
‘These are all points that we on the Leave side made during the referendum campaign. The assurances given today by Mr Azevedo further strengthen the case for speeding up the United Kingdom’s departure from the European Union.’
In a leaked tape of Mrs May talking to bankers a month before the June 23 vote, the then-home secretary told an audience that leaving the single market would threaten jobs.
Speaking to investment bankers at Goldman Sachs, she said that global companies would think twice about investing in the UK if we left.
Theresa May warned that companies would leave Britain if it voted to leave the EU while giving a private audience at investment bank Goldman Sachs in London (pictured) on May 26
The comments, revealed in the Guardian, are stronger than her more nuanced public position during the referendum campaign.
Although she was a Remain supporter, No 10 was worried about her lukewarm support for EU membership.
Downing Street sought to play down the remarks insisted Mrs May is now committed to making a ‘success’ of Brexit.
But Labour said it represented ‘cast-iron evidence’ of how ministers had been two-faced over cutting ties with Brussels.
Shadow minister Andrew Gwynne said: ‘As if we needed it, this recording is cast-iron evidence of how Theresa May and other senior Tories have been saying one thing in private about the economic impact of Brexit, and another in the comfort of Tory conference halls.
‘It’s plain that she recognises what a disaster it would be for Britain to lose access to the Single Market, so why doesn’t she be honest with the British people and say how she plans to retain it?’
Shadow Brexit secretary Keir Starmer was among the political opponents seizing on the video of Theresa May
The recording reveals Mrs May had numerous concerns about Britain leaving the EU. She appeared to go further than her public remarks to explain more clearly the economic benefits of staying in the EU when speaking at the bank in London on 26 May.
She told staff the UK should be taking a lead in Europe, and that she hoped voters would look to the future rather than the past.
She also worried about the effect of Brexit on the British economy in the hour-long session before the City bankers. ‘I think the economic arguments are clear,’ she said. ‘I think being part of a 500-million trading bloc is significant for us.
She said at the Conservative party conference (pictured) she wanted to prioritise reducing immigration over being part of the single market
‘I think, as I was saying to you a little earlier, that one of the issues is that a lot of people will invest here in the UK because it is the UK in Europe.
‘If we were not in Europe, I think there would be firms and companies who would be looking to say, do they need to develop a mainland Europe presence rather than a UK presence? So I think there are definite benefits for us in economic terms.’ Mrs May also told the bankers she was convinced it was best for Britain’s security to remain in Europe because of tools such as the European arrest warrant.
Last night’s disclosures could prove embarrassing for the Prime Minister.
Her warning about the importance of the UK’s membership of the EU contrasts her position in recent weeks.
She said at the Tory party conference she wanted to prioritise reducing immigration over being in the single market.
A No 10 spokesman said: ‘Britain made a clear choice to vote to leave the EU and this government is determined to make a success of the fresh opportunities it presents.
‘David Davis made very clear in the House of Commons last week the importance the government places on financial services across the UK in the negotiation to come, as has the Chancellor in recent weeks.’