Trade Deals Around the World: March Edition 2023
Trade Deals Around the World is our periodic update, giving you a quick and easy overview of what has happened in the many trade deal negotiations worldwide.
We focus on the European Union and the United Kingdom and watch China and the United States. We look back at February and focus on trade deals only in this update.
The European Union and The United Kingdom
Last month's biggest news was the Northern Ireland trade deal between the European Union and the United Kingdom. The border situation between Northern Ireland and Ireland is delicate, and both parties wanted to ensure no hard border crossings were necessary.
Reuters gives an overview of the main points in the agreement:
The two sides have agreed to separate goods just going to Northern Ireland and those which will continue into the EU into "green" and "red" lanes.
This is designed to reduce the paperwork facing companies that have said they were unable to provide a full range of products to Northern Ireland because the number of checks were too onerous.
The Northern Ireland Assembly will now be able to "pull an emergency brake" to stop new EU single market rules applying if 30 out of the 90 members from at least two parties oppose the measures.
If the threshold is met they can ask the UK government to apply a veto to the new laws.
Under the new deal, the British government will have freedom to set VAT and subsidies in most instances in the province.
Von der Leyen said once the new deal is implemented work would begin on restarting Britain's cooperation with Horizon.
More on the deal:
The European Union and Mercosur
Another trade deal that is taking a lot of time to get ratified is the one between the European Union and one of the largest trading blocs in the world: Mercosur.
The European Union hopes to sign a free trade agreement with the Mercosur countries (Argentina, Brazil, Paraguay and Uruguay) by July, Commission Vice-President Frans Timmermans said on Monday in Mexico City.
The draft agreement, reached in June 2019 after 20 years of negotiations, was never ratified due to concerns in Europe over the environmental policies of then Brazilian President Jair Bolsonaro.
There is no doubt that the strategic value of Latin America and the Caribbean to the EU has increased since the Russian invasion of Ukraine.
In Latin America, the EU has competition. The US is looking to regain lost ground, China is consolidating its position as the most important trading partner for many countries, and other actors are also showing an increased interest in Latin America as a source of raw materials and as a sales market.
From a European perspective, there seem to be two realistic options for getting the EU-Mercosur agreement over the finish line. A joint declaration by both sides, clarifying some of the commitments in the chapter on trade and sustainable development; or a binding additional protocol, which could introduce – in contrast to the first option – new commitments alongside those already included in the draft EU-Mercosur agreement
In recent years, China has become Mercosur's biggest trading partner and Lula da Silva wants to discuss the conditions for a trade agreement with Beijing during his visit to the country in March.
The EU therefore needs to step up dialogue with Mercosur and is keen to boost imports of mineral resources that are crucial for the so-called green industrial revolution and where China has a dominant position.
The European Union and Australia
We already reported on a deal between the EU and Australia being close last month, And a deal is indeed still getting closer. The Guardian reports:
Australian and European Union negotiators believe they are getting closer to clinching a free trade agreement as they race to meet a mid-year deadline, but the Albanese government warns it will “not sign a deal for the sake of it”.
Officials hope the next formal round of negotiations – due to be held in the EU in April – could be the final such round before the broad shape of a deal is agreed.
You can find a report of the 14th round of negotiations here.
The European Union and New Zealand, and Thailand
On New Zealand: Halfway through February, the European Commission also presented the EU-New Zealand trade agreement for ratification—more about that on the European Commission website.
Director General Auramon Supthaweethum from Thailand’s Trade Negotiations Department shared that the discussion of Free Trade Agreement (FTA) between Thailand and the European Union (EU) will soon be resumed, after it was put on hold since the 2014 coup.
The United Kingdom and India
The United Kingdom still has an extensive list of trade agreements that it needs to negotiate. One of the larger ones is with India. The Economic Times reports on the progress:
The next round of negotiations for the proposed free trade agreement (FTA) between India and the UK is scheduled from March 20-24…
Both sides have agreed to discuss and finalise modalities for exchange of offer in goods and services during the fourth round of talks.
Other News on Trade Deals
- Presidents of Colombia, Venezuela sign trade deal on border - ABC News
- DRC and Tunisia sign a new trade agreement - Eco Finance Agency
- Pakistan, Uzbekistan sign $1bn trade agreement - The News
- Thailand and China to Expand Free Trade Agreement (FTA) - Thailand Business News
- China, Nicaragua step up negotiations on free trade agreement - China Daily