World Economy

Juncker Warns Britain as London Eyes China Trade

At least 20,000 laws will have to be changed in Britain before it could leave the European Union
Jean-Claude Juncker (L) and Theresa May meet before the G20 foreign ministers meeting in Bonn on February 16.Jean-Claude Juncker (L) and Theresa May meet before the G20 foreign ministers meeting in Bonn on February 16.

European Commission President Jean-Claude Juncker has warned the UK it cannot negotiate bilateral trade deals in the period before it leaves the EU. London, meanwhile, is eyeing up China with talk of a 'golden era.'

"Trade deals are the remit of the EU... Britain cannot complete trade deals with half the world—although it is doing the opposite," Juncker said on Thursday, adding that he believes it will take longer than two years to agree on all the arrangements for the UK to leave the EU, DW reported.

"I do not think ... we will succeed within 24 months to clear up the arrangements for Britain's exit from the EU and to (forge) the whole relationship between Britain and the European continent," he said in a speech at the international Munich Security Conference.

British Prime Minister Theresa May has said she will trigger Article 50 of the EU's Lisbon Treaty in March and launch divorce talks, which could last up to two years.

Juncker also said at least 20,000 laws had to be changed in Britain before it could leave the bloc.

A New Golden Era?

The London and Beijing governments meanwhile said a new "golden era" in their relationship was dawning, pledging trade and cooperation during a Thursday meeting of Chinese Foreign Minister Wang Yi and his British counterpart Boris Johnson on the sidelines of a meeting of the Group of 20 largest industrialized countries in the western German city of Bonn.

China is one of the countries the UK hopes to sign a free trade agreement with after it leaves the EU. London and Beijing are keen to show that the UK's withdrawal from the bloc will not affect ties.

Wang said that both nations would promote cooperation on projects such as the Hinkley Point nuclear power station in Britain and would look to strengthen their partnership on issues such as trade through close high-level exchanges, the Xinhua news agency reported on Friday.

May has been invited by China to attend a major summit on the "One Belt, One Road" initiative to build a new Silk Road, diplomatic sources told Reuters.

Imperfect Knowledge 

Meanwhile, former UK premier Tony Blair is set to outline his mission to persuade the UK to stay in the EU in his first big speech since the EU referendum.

"The people voted without knowledge of the true terms of Brexit. As these terms become clear, it is their right to change their mind,” he is expected to say. “Our mission is to persuade them to do so."

"Our challenge is to expose relentlessly the actual cost, to show how this decision was based on imperfect knowledge which will now become informed knowledge, to calculate in ‘easy to understand’ ways how proceeding will cause real damage to the country and its citizens, and to build support for finding a way out from the present rush over the cliff’s edge," the former Labor leader and controversial politician said.

Sterling Drops

Sterling sank to a 10-day low against the euro on Friday after a surprise third monthly fall running in British retail sales pointed to weakening consumer sentiment as the government gets ready to launch talks on leaving the European Union.

Sterling hit its lowest in 10 days against the euro, down almost 0.5% on the day at 85.82 pence. It fell to a one-week low of $1.238, down almost 1% on the day. 

“After surprisingly weak numbers in December, sales figures for January have taken another turn for the worst and analysts believe more troubling times lay ahead,” said Paul Sirani, chief market analyst at online broker Xtrade. “Retail was the beating heart of the UK economy in 2016, so with consumer spending expected to slide in the coming months we could see the pound push lower against both the euro and the dollar.”


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