1221 GMT January 21, 2018
The newspaper said British ministers were looking at the idea of joining the North American Free Trade Agreement (NAFTA) as part of planning for possibility of Britain leaving the EU in March 2019 without a trade deal, according to Reuters.
Britain’s international trade ministry did not immediately respond to a request for comment on the report.
Britain is currently negotiating the terms of its divorce from the EU though Prime Minister Theresa May is pushing to move onto discussions about a major free trade deal with the world’s biggest trading bloc.
With the clock ticking down toward Brexit day in 2019, British ministers are exploring what they will do if the world’s fifth largest economy drops out of the EU without a clear trade deal.
Besides aiming to clinch a US trade deal or forming some new trade grouping, some British supporters of Brexit have pondered joining an existing trade deal such as NAFTA.
But U.S. President Donald Trump has warned he may terminate the 1994 NAFTA deal because he says it does not serve US economic interests.
If Britain did join NAFTA, manufacturers wanting to export to the EU and North America would have to produce goods in accordance with the two separate sets of rules, according to trade analysts.
Britain, whose regulation has been within the EU’s orbit for over 40 years, would also have to shift toward the North American model for services, goods, competition policy and data protection.
The EU is Britain’s biggest single export market, accounting for about 50 percent of goods exports in August. The United States was the single biggest destination for British exports, accounting for 14 percent in August.