UK Finance to PM: Canada-style trade deal is not ambitious enough

The UK’s top financial lobby group has urged the Prime Minister to seek a more ambitious trade deal than a Canada-style agreement.

In a letter published today, UK Finance said the Canadian deal was an “interesting template”, but it urged Theresa May to look beyond the scope of existing trade agreements.

“Given the UK and the EU 27 start with a position of regulatory convergence that the UK and Canada didn’t, we should seek to be far more ambitious,” it said.

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It came as May insisted that the UK was on its way to securing the “best and most ambitious” Brexit deal as talks on trade and a transition period begin following a breakthrough earlier this month.

Tensions bubbled yesterday after Philip Hammond, while on a visit to China, said a two-year transition period after Brexit would “effectively replicate the current status quo”.

However, foreign secretary Boris Johnson argued that the UK could not mirror EU law indefinitely.

In an interview with the Sunday Times, Johnson said a failure to secure a trade deal in which Britain can decide its own regulatory framework and laws would move the UK “from being a member state to a vassal state”.

He said the UK should seek a “new and ambitious” deal with zero tariffs and frictionless trade.

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