UK will reject any EU request to extend Brexit transition

[LONDON] The UK government said it will reject any request from the European Union to delay the final stage of Brexit even as coronavirus hampers negotiations over their future economic relationship.

"Extending the transition would prolong business uncertainty," government spokesman James Slack said on a call with reporters on Thursday, referring to the continuity period due to end on Dec 31. "UK business needs to know what its future trading arrangements will be and how to adapt to them. It's better to be clear now."

The coronavirus has forced the two sides to put trade negotiations on hold and left businesses reeling, prompting many executives to call for an extension to the post-Brexit transition period. Under the terms of the Withdrawal Agreement, both sides have until June to propose a postponement. It would require mutual agreement to take effect.

Mr Slack's comments mark a hardening of the UK's position: While Downing Street has long ruled out seeking an extension itself, ruling out any request from the EU side significantly increases the risk that Britain could, in effect, crash out of the bloc without a trade deal in place - leading to the return of border controls and the end of frictionless trade.

The two sides are trying to reach a limited free-trade agreement akin to the EU's relationship with Canada. Such an accord would eliminate tariffs on goods but exclude services and saddle businesses with added costs in the form of additional paperwork and red tape. Negotiation are due to restart next week after being put on hold by the virus.

IMF head Kristalina Georgieva on Thursday suggested that the 2 sides extend their deadline on striking a post-Brexit trade deal in the face of coronavirus uncertainty.

"My advice would be to seek ways in which this element of uncertainty is reduced in the interests of everybody, the UK, the EU, and the whole world," Ms Georgieva told the BBC when asked if she would advise on an extension.

"I really hope that all policymakers everywhere would be thinking about" reducing uncertainty, she added.

"It is tough as it is, let's not make it any tougher."

BLOOMBERG, AFP