With just four weeks to go until B-Day and still no agreed deal with the EU, by now you may have caught a glimpse of the biggest unicorn in the Brexiteers’ bulging stable: it’s called Article 24.
Leavers from Nigel Farage to former Cabinet minister Owen Paterson and Jacob Rees-Mogg can’t let an interview slip by without reference to this mysterious mythical beast, which is part of the World Trade Organisation’s General Agreement on Tariffs and Trade.
That particular document may not have been top of your reading list lately, and no wonder.
But broadly Article 24 sets the conditions that all free trade deals and customs unions should meet: there’s a clause buried in it that allows two parties to trade with each other tariff free by declaring to the WTO that they are in the process of negotiating a free trade agreement.
Thus they sidestep the WTO’s rules that force countries to offer the same trading terms to all the other members. You just need to have an interim agreement which leads to a full deal within a “reasonable length of time”, which should “exceed 10 years only in exceptional cases”, according to the Article 24 text.
Brexiteers have seized on this as the ultimate in cake-ism. Who needs a deal? We can trade with the EU tariff free for a decade! What’s not to like about that? Except it’s “complete nonsense”, according to trade expert Sam Lowe, of the Centre for European Reform. “It sounds tech-y and convincing and it’s being used by the Brexiteers to try to sanitise a no-deal,” he says.
The first and major issue is one of the “interim agreement”. As it stands, we have no agreement: that’s what no-deal means. We can’t exactly act unilaterally or frogmarch the EU to the WTO and say, ‘we’re working on it, can we have our zero tariffs please?’.
And even if there was an interim agreement, which there isn’t, according to the WTO rules the deal would need to include a “plan and schedule” for the final agreement. All we have on that front is a vaguely worded political declaration which isn’t legally binding. And we haven’t even begun to work on what the future trading relationship is going to look like; that is years away.
Aside from being a shock to the majority of the public hoping never to hear the B-word again after March 29, it also means that other WTO members could object to the tie-up if they thought there wasn’t a realistic chance of getting things done.
All this comes before the broader point that there’s an bigger threat to trade than tariffs: namely the welter of non-tariff barriers like regulations and inspections all set to add major friction and costs to UK importers and exporters in a no-deal scenario.
On Article 24 in particular, Peter Ungphakorn, a former official in the WTO secretariat, no less, calls it a “pretty blunt secret weapon” and hopes that “this red herring dies a peaceful death”.
That’s not likely, as Eurosceptics will seize on any fairy story to kindle the dream of no-deal.
Thankfully, Theresa May has made that less likely this week after her fingernail-dragging retreat to give her MPs a series of votes, which should see a decisive rejection of a crash-out.
The Government has also done its best to thwart the fantasists with its own assessment of the Article 24 ploy, which this week’s no-deal assessment states is based on a “misunderstanding of what the rules are”.
Trade Secretary Liam Fox also noted in January that “in the political atmosphere of no deal, it would be difficult to cultivate the good will necessary for that to proceed”, while the report reminds us of a 9% hit to the economy over 15 years even before the impact of short-term disruptions.
Yet still you hear Leavers talking about an Article 24 Brexit like it was plucking an apple off a tree.
Even though it’s wrong, and informed people (even those who used to work at the blooming WTO, for goodness’ sake) keep telling them it’s wrong, the hardliners keep repeating it over and over.
And you’ll hear it again and again over the next few weeks even though it’s a falsehood so egregious it almost belongs on a red bus.
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