UK and European Union Finalize 3.5-Year Divorce

British Union Jack with red scissors instead of stripes
Its over
Jan 31, 2020
LONDON, UNITED KINGDOM – Celebrations are underway here after more than three and a half years since the epochal referendum in June 2016 when UK voters opted to separate from the European Union (EU).  The “Brexit” train ebbed and flowed throughout that time but experienced a resurgence of support after Prime Minister Boris Johnson took the helm in July 2019 and helped deliver a resounding new majority to parliament for the pro-Brexit conservative party in December 2019.

After midnight tonight, the world will watch and wait for the UK to publish their negotiating objectives with both the United States and the EU to determine where discussions are likely to lead.  While a comprehensive deal with the EU will be the likely priority for the UK, concurrent negotiations with the U.S. are expected to begin as early as next month.

Late last week, U.S. Treasury Secretary Steven Mnuchin said, “We’re focused on trying to get this done this year,” in reference to a trade agreement with the UK.  When asked about the ability for the UK to negotiate concurrently with the EU and the U.S., he said, “there are certain issues that perhaps they need to resolve with the EU, but there are a lot of issues that can be resolved simultaneously.”

Last month, the U.S. Trade Representative Ambassador Robert Lighthizer said, “The U.K. is a priority.  As soon as they get their objectives agreed to, we will start talking.”

As a rice miller and consumer, but not a rice producer, the UK provides a new opportunity for the U.S. rice industry to gain some ground by providing UK buyers with a quality, consistent, and price-competitive product outside of the existing 38,000-ton quota for the broader EU.

Mark Holt, chair of the USA Rice European Union Trade Policy Subcommittee, said, “USA Rice supports the full, existing EU quota for U.S. rice to remain with the EU, providing an opportunity for duty-free access into the UK.  Brexit finalization has been a long time coming but the real work is about to start.”

He added, “Following an industry trip there last month, it is evident that there’s demand for our rice, but we also know that trade negotiations are usually tougher than they seem on the outset.  We are prepared to ride this one out until completion, even if it’s beyond 2020.”