The U.K. government's inability to agree to post-Brexit trade deals is not just limited to its future relationship with the European Union. In the three years since the U.K. voted to leave the EU, the Department for International Trade — specifically created in the wake of the referendum — has secured trade agreements with countries that cover just 6.8% of total U.K. trade in goods, according to calculations by S&P Global Market Intelligence. The Department for International Trade was created to renew the existing 40 free trade deals, covering more than 70 countries, which the U.K. is currently party to as a member of the European Union. Just 15 trade deals have been agreed to date, while another is expected to be complete with the Southern African Customs Union and Mozambique (representing a mere 0.8% of total U.K. trade) shortly. The total is a far cry from the optimistic outlook expressed by prominent Brexiters during and after the referendum campaign. In July 2017, 13 months after the referendum, then international Trade Secretary Liam Fox said a post-Brexit free trade deal "should be one of the easiest in human history." Progress has instead proven to be painfully slow, with the U.K. yet even to agree how to exit the EU and the nature of their future relationship, with a third deadline Oct. 31. The U.K.'s trading relationship with the EU is by far its most consequential. The EU accounted for 54.4% of total U.K. trade in goods in 2018, and seven of the U.K.'s top 10 trading partners are from the continent. Less comprehensive deals have been struck elsewhere Beyond the 15 trade deals to be rolled over after Brexit, the U.K. has also signed "mutual recognition agreements," or MRAs, with the U.S., the country's single largest trading partner, as well as Australia and New Zealand. Trade in goods with the three countries accounts for 12.6% of the U.K.'s total. MRAs are not as comprehensive as trade deals, but maintain the existing arrangements with the EU and ensure goods are compliant with technical regulations before they are shipped. In the case of the U.S., this is particularly applicable to the pharmaceuticals industry, as well as tech and telecommunications equipment. Yet the arrangement will cover just £8.9 billion of U.K. exports to the U.S., or 16% of the total. The Department of International Trade has already conceded that deals with Turkey, Andorra and San Marino, countries within the EU customs union, will not be ready by Brexit. While discussions with Japan, which accounts for around 2% of U.K. trade, will also not be ready. Japan has signed an "exchange of letters," which will continue existing arrangements temporarily. As a result, U.K. goods can be tested against Japanese regulations within the U.K. and then exported to Japan without additional screening, and vice versa. But expectations that Japan would happily replicate the free trade deal agreed between Japan and the EU in February may prove optimistic, with reports suggesting Japanese negotiators believe they can secure better terms in a new U.K.-specific arrangement. The primary difference in this instance appears to be leverage. While Japan, a $4.971 trillion economy in 2018 according to the World Bank, was willing to concede on measures with the European Union, an $18.756 trillion economy, it is less interested in doing so with the U.K., a $2.825 trillion economy.
The UK's Department for International Trade has secured deals covering just 6.8% of the UK's total trade in goods, while a single post-Brexit agreement is in place with its top-10 partners, S&P Global Market Intelligence said. "The UK will be able to negotiate new bilateral agreements that are more favourable than those currently being negotiated by other EU members," said Simon Johnson, head of research at To date, 15 deals have been agreed, alongside "mutual recognition agreements" with the US, Australia and New Zealand, which maintain existing EU arrangements. Deals with Japan, Turkey, Andorra and San Marino won't be ready by 31 October.