Two of the candidates for the top position at the WTO have expressed differing opinions about how the UK would fare if it doesn’t secure a trade deal with the EU.
Should the two parties fail to agree a future trading relationship, trade between the two will resume on WTO rules from the end of the transition period on 31 December 2020.
‘UK can flourish’
Hamid Mamdouh, a former WTO director of trade in services and investment, is standing as Egypt’s candidate to replace Roberto Azevedo, who announced his resignation in May.
The Telegraph reports that Mamdouh thinks the UK and EU have an “exceptionally strong basis” for future trade, even if they do not agree a deal.
He said the UK will not fare as well as it would being a member of the bloc but argued it could still “flourish” due to the strength of its service sector, which accounts for 80% of the country’s GDP.
“There will still be the reality of business flourishing in a way that, of course, isn’t as strong as when the UK was a member state of the EU, but it’s the passage of time without a bilateral agreement that will have an effect,” he said.
“I perhaps don't see that the UK would lose as much on the services side as it would on the merchandise side if we reach the end of the year and then fall back on WTO terms,” he added.
‘Enormous price’
The Telegraph also reports Lord Mandelson, who is standing to be the UK’s candidate against former trade minister Dr Liam Fox, saying the UK would suffer an “enormous price” if it failed to secure a deal.
“Coming on top of the whacking businesses and jobs have had from Covid, quite honestly, it doesn't bear thinking about," he said.
“Which is why I believe this government, which has not lost all sense of perspective, would realise that it does need a deal. It can't deliver a second whammy of that kind to the UK economy.”
Mandelson believes he has a greater chance of being nominated as the UK candidate for the role because he has a greater chance of winning the job.
Outgoing leader’s views
Outgoing director general, Roberto Azevedo, said in June that a deal could be secured if there was “political will”.
Appearing on the BBC’s Andrew Marr Show on 14 June, he warned “the less turbulence the better” when asked about the potential impact of failing to reach a deal.
