Eng-EU, Heated Debate Over 'Financial Market' Agenda in Trade Negotiations

[Asia Economy Reporter Jeong Hyunjin] The United Kingdom and the European Union (EU), which will officially begin trade negotiations next month, engaged in a heated debate over differing views on the financial services market.

On the 11th (local time), according to the daily newspaper The Guardian and others, Sajid Javid, the UK Chancellor of the Exchequer, urged the EU to consider the UK's financial sector as "equivalent" to that of the EU. This refers to the procedure known as the 'equivalence principle.' The EU evaluates whether the regulatory system of a third country, which is not a member state, is equivalent to EU regulations, and if deemed equivalent, allows companies from that country access to the EU market in the relevant sector.

However, on the same day, Michel Barnier, the EU's chief negotiator for Brexit, warned the UK at the European Parliament in Strasbourg, France, saying, "You should not harbor illusions," and added, "There will be no comprehensive and permanent equivalence in financial services." He emphasized, "The opening of our market, access to data, and financial services equivalence will be proportional to commitments to truly fair competition, regulatory consistency, citizen protection, and financial stability."

The EU has stated that the UK's access to the EU financial market will be linked to broader trade issues such as fishing rights. However, the UK argues that these are separate issues and should be negotiated independently. Additionally, the EU insists that tariff-free and quota-free agreements are possible only if the UK agrees to EU standards, but the UK says it cannot comply with those regulations.

On the same day at the European Parliament, Ursula von der Leyen, President of the European Commission, dismissed UK Prime Minister Boris Johnson's idea of a loose trade agreement with the EU, reiterating that if the UK wants a tariff-free, quota-free trade agreement, it must agree to EU regulations and standards. Regarding Johnson's mention of the 'Australia model,' von der Leyen said, "I was a bit surprised," adding, "The EU does not have a trade agreement with Australia, and we currently trade based on World Trade Organization (WTO) terms." She continued, "If that is the UK's choice, we are fine with it," but stressed, "Personally, I think we should be more ambitious."

This content was produced with the assistance of AI translation services.