Now that the UK is well into its final week as a member of the EU, the focus is very much on what type of relationship will replace the single market and customs union that the UK has shared with the other EU countries since it was set up in 1992.

That meant that people, money, goods and services could move freely between the 28 countries that make up the EU in the same way that they could move between Dublin and Cork or Birmingham and London.

That relationship ends this Friday at 11pm Irish time, with the UK leaving the EU and entering what is described as a transition phase, during which both sides are supposed to sort out a future trading relationship that will replace the single market and customs union.

That relationship ends this Friday at 11pm Irish time, with the UK leaving the EU and entering what is described as a transition phase

The UK government has committed to this ending at the end of 2020, though there is provision for extension for up to two years if the UK have a change of mind and makes the request.

What the UK is leaving was the ultimate free trade deal and whatever follows will make trade between Ireland and Britain more complex no matter how close the free trade deal is.

Type of future deal

The UK leaves the EU on Friday, but businesses trading with the UK have no idea of what a future trading relationship will look like.

Even for Northern Ireland companies, there is uncertainty on how trade with the rest of the UK will work. This is because of the Irish protocol in the withdrawal agreement that keeps Northern Ireland aligned with the EU on standards and act as enforcer of EU customs arrangements though they will be part of the UK customs union.

There was much fuss at the end of last week with representatives of Northern Irish trade associations warning about the complexity of completing forms for product leaving Northern Ireland going to the rest of the UK and coming into Northern Ireland from the rest of the UK.

There is a further concern in agri food around the possible impact of enforcing customs and tariff collection.

Border crossing for commercial vehicles at Swiss-German border. The EU and Switzerland have an extremely close trading relationship, but border checks are still required.

The most obvious example is where cattle are brought into Northern Irish factories from Britain for slaughter and processing. Once these animals are slaughtered in the North, the component parts are sold both inside the UK and in the EU27.

Whatever is sold to the EU27 would carry whatever tariff is applicable in an agreement after the end of 2020. If there is no agreement, it is WTO terms for trade between the UK and EU including beef from cattle slaughtered in Northern Ireland if these have originated elsewhere in the UK.

Compared to this, Northern Irish companies see extra form-filling as simply an unwelcome bureaucratic burden, adding cost, but no more than that.

EU versus US

The UK wants to keep something similar to the current trading arrangements with the EU, but not be bound by the rules - having the cake and eating it is the phrase frequently used to describe it.

The UK doesn't want the rules because it wants to make separate trade deals on its own, the highest profile being with the USA. The EU has also been in negotiation with the USA on a trade deal (TTIP), but that has been suspended since President Trump came to power.

How the UK defines its standards on imports of hormone-treated beef and chlorine-washed chicken will determine the extent of any trade deal with either the USA or EU

Over this weekend, the US ambassador to the UK Woodie Johnson is again making the news with his views on a US-UK trade negotiation.

In a letter to The Times newspaper, he is rejecting UK objections to chlorinated chicken, pointing out that the Food Standards Agency has approved chlorine wash for vegetables in the UK.

How the UK defines its standards on imports of hormone-treated beef and chlorine-washed chicken will determine the extent of any trade deal with either the USA or EU.

If they accept both, they will secure a comprehensive deal with the USA, but a very basic deal with the EU. If they don't, the USA won't have much interest in a comprehensive trade deal, but it makes a comprehensive deal with the EU a reality.

Best for farmers

Irish and UK farmers have the same interest in UK future trade deals; the closer with the EU the better.

If the UK diverges on standards and tariffs, opens up to other third countries and trading blocs, the UK market for agricultural produce will become devalued both for Irish exports and domestic produce, with Irish beef and British (not Northern Irish) particularly vulnerable.

This wont be an issue immediately after Brexit on Friday, but by this time next year it will be.

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