Hard Brexit will pave way to trading riches

BRITAIN can secure trade deals worth twice the amount of those signed by the European Union if it adopts a more extreme form of Brexit, leading Eurosceptics have said.

Change Britain, a group co-founded by Michael Gove and endorsed by Boris Johnson, has discovered that 14 countries have publicly expressed interest in an agreement after Brexit.

The nations have economies that total around £17 trillion – twice the size of those countries who already have a trade deal with the EU.

However, the UK can only capitalise on that potential if it decides to opt out of the EU customs union, which allows goods to circulate freely without checks, the group warns.

Lord Jones of Birmingham – the former CBI head who served as Gordon Brown’s trade minister – said the move would allow Britain to export to “millions more customers”.

It comes as two new reports suggest that the City of London can thrive after Brexit, despite the concerns of leading financial institutions. Leave Means Leave, a pro-Brexit group, says the financial sector could save £12 billion a year by cutting EU red tape. The think tank Legatum Institute says the importance of passporting has been “overstated”.

A row is raging in the Cabinet about whether Britain should pull out of the customs union.

Leading Eurosceptics such as Liam Fox, the International Trade Secretary, favour leaving the customs union

because it would give Britain the freedom to secure its own trade deals. However, more pro-EU figures who fear the impact on trade with the EU and added complexity on the Northern Irish border from bringing back customs checks oppose the move.

New analysis from Change Britain, a Brexit campaign group launched after the referendum, shows the size of opportunity on offer if Britain opts for a cleaner break with the EU.

In total, 14 countries have publicly stated they want a free trade deal with the UK, according to the group, including China, Brazil, India, Argentina and Australia. Many have not secured deals with the EU, which critics say has consistently proved itself to be a poor trade negotiator, partly because of its size.

This month a flagship deal with Canada seven years in the making almost collapsed when the Belgian region of Wallonia vetoed the move, though it now appears to be back on track. Justin Trudeau, the Canadian prime minister, will finally travel to Brussels to sign the free trade deal known as the Comprehensive Economic and Trade Agreement (CETA) today.

Countries that have expressed interest in a post-Brexit trade deal have a combined GDP of £16.8 trillion, according to researchers for Change Britain.

The EU has secured trade deals with many more countries but struggled to strike agreements with bigger nations, according to the research. The combined GDP of countries with trade deals with the EU is just £7.2 trillion.

The group concluded: “While the EU is in discussions with some major economies – including Canada and the US – recent events have shown how the EU cannot be relied upon to agree to a free trade deal due to the shortcomings in its decision-making process.”

Lord Jones said: “By leaving the single market... we can strike trade deals with the rising economies of the 21st century, many of whom have already signalled their intentions to begin negotiations... we should grasp this opportunity with both hands.”

In a separate development, two new reports suggest that the City of London can thrive after Brexit despite the concerns of leading financial institutions.

Leave Means Leave says the financial sector can get an annual boost of up to £12 billion after leaving the EU by designing regulation that is more appropriate to the UK.

The Legatum Institute think tank says the City can “survive” without passporting, which allows banks to trade freely across the EU. It points to the “strengths” already existing in Britain’s financial services industry and says “independence from EU laws and regulation” will be beneficial.