The top economic stories of 2020 part 1 of 5
As we approach the deadline, there is a strong possibility that the negotiations will break down and result in a “no-deal” Brexit
By ATB Economics 14 December 2020 2 min read
It’s that time of the year when we take a look back—from an Alberta perspective—at the top economic stories that took place over the previous 12 months. Each Owl this week will examine one story.
The full list, along with other observations about the year that was, are discussed in the latest edition of ATB’s The Future Of podcast hosted by our Chief Economist Todd Hirsch. The year-end edition can be found here and features commentary from energy guru Jackie Forrest.
First up is the ongoing saga known as Brexit. Brexit (a combination of “British” and “exit”) refers to the withdrawal of the United Kingdom from the European Union on January 31, 2020. Brexit also means that the U.K. will no longer be a party to Canada’s free trade agreement with the E.U. as of January 1, 2021.
A transition period during which the U.K. remains in both the E.U. customs union and single market expires on December 31, 2020. The idea behind the transition period was to give the parties time to hammer out a deal that would preserve at least some elements of free trade between them and address other issues such as how to manage the land border between Ireland and Northern Ireland.
As we approach the deadline, there is a strong possibility that the negotiations will break down and result in a “no-deal” Brexit.
As an economy highly dependent on open global trade, Brexit—especially a “no deal” version—is not good news for Alberta as it is part of a rising tide of trade protectionism and parochialism that threatens the economic growth associated with the free movement of goods and services across borders.
On the bright side, Canada and the U.K. have inked the Canada-U.K. Trade Continuity Agreement. Global Affairs Canada describes the agreement as “an interim deal that will be in place as Canada and the United Kingdom work towards negotiating a comprehensive free trade agreement.” It remains to be seen, however, if Parliament will pass the legislation to implement the agreement before the transition period ends on December 31.
ANSWER to Friday’s trivia question: What is the best selling toy of all time? The Barbie doll is the best selling toy of all time with over a billion dolls sold since she made her debut in 1959.
Today’s question: In what year did the United Kingdom join the European Communities (which later became the European Union)?