Brexit – Australia Can’t Wait So They Offer Free Trade Deal With Britain

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Jul 18 2016
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True, behind every crisis or problem, there’s a golden opportunity. But it’s also true that you’ve to bet on a correct business opportunity before you hit the jackpot. Equally true is that you have to be early to get the best deal. After Brexit and the formation of a new government, Britain is on high gear scoping for free trade deals.

Brexit - UK Abandon EU Sinking Ship

As we’ve said earlier, Britons should “just do it” instead of debating and worrying about the consequences of Brexit. The reasons are pretty simple. Economically, United Kingdom is the second largest in the European Union and the world’s fifth largest (by GDP). No country in the world would stop trading entirely with such economic powerhouse because of Brexit.


Investors, economists, analysts and punters should be more bullish about British Pound, now that the currency has been spectacularly shamed and dumped post-Brexit, than the Euro. While Chancellor of Germany Angela Merkel and her boys are impatiently waiting for UK to trigger Article 50, newly crowned British Prime Minister Theresa May is dragging her feat – deliberately.

New British Prime Minister Theresa May Speech at 10 Downing Street

Article 50 of the EU’s Lisbon Treaty – which has never been used before – starts a 2-year clock ticking on a formal exit arrangement. But here’s the beautiful thing about the article. Only the British Prime Minister can officially trigger it, and there’s not a damn thing that Angela Merkel or Francois Hollande can do about it if Theresa May refuses to activate it.


Theresa May has made it clear that her government is not dumb, and will only activate the article on January 1, 2019, so that Britain can comfortably secure free trade deals with at least 12 important countries. Liam Fox, UK’s new International Trade Secretary, revealed he had opened “very fruitful” negotiations with Canada.

Liam Fox – British International Trade Secretary

Mr. Fox is to fly to the United States this week to ensure Britain is not at the “back of the queue”, as President Barack Obama had threatened before EU-Referendum but made a spectacular U-turn after Brexit. While May administration is on top gear at negotiation tables, a country that cannot wait for its turn has offered a free trade deal with Britain.


Australia is one of many countries that love to do a trade deal with the world’s fifth biggest economy (UK) without having to deal with the other 27 members of the EU. Instead of waiting, Australian Prime Minister Malcolm Turnbull proactively offers a free trade deal with Britain, Australia’s seventh largest trading partner.

Australian Prime Minister Malcolm Turnbull

We can make Brexit work for Britain. One of the ways we will do this is by embracing the opportunities to strike free trade deals with our partners across the globe. It is very encouraging that one of our closest international partners is already seeking to establish just such a deal.” – Theresa May said after her counterpart Malcolm Turnbull urgently requested for a trade deal.


According to Australian government trade figures, Australia exported A$8.3 billion (£4.5 billion) to the UK in 2014 and imported A$12.4 billion (£6.5 billion). The figure, however, is a fraction of Australian export to China, which amounted to A$100 billion (£55 billion). Still, UK is Australia’s second biggest direct foreign investment, after the United States.

United Kingdom and Australian Relationship - Flag Painted on Face

Although the UK cannot sign any deals while it is still an EU member, and experts warned trade deals take a long time to negotiate, the fact that the new British government would trigger Article 50 on January 1, 2019 goes to show that trade deals between Britain and important trading partners would start rolling by January 1, 2021 – roughly 5½ years away.


Between now and January 1, 2019, United Kingdom can negotiate and secure “informal agreement” on new trades. Another reason to start deals early, such as the one urgently requested by Australian government, is the possibility of getting a better deal from the old one. Interestingly, Australian PM Malcolm Turnbull was the same guy who said British should stay in the EU.

 Prime Minister Theresa May - Team o Battle Brussels - Boris Johnson and David Davis

But what about the EU market access for UK? David Davis, the Minister for Brexit, reasserted his belief that the EU would grant Britain access to the single market as well as a suspension of free movement rules, something which European leaders have so far ruled out. When that actually happens, Brexiteers would be calling EU bluff, having their last laugh.


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