What does leaving the EU on WTO terms actually mean

BREXIT - what does leaving the EU on WTO terms actually
mean?

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Word of the Day

WTO

The World Trade Organization (WTO) is the only global
international organization dealing with the rules of trade between nations. At
its heart are the WTO agreements, negotiated and signed by the bulk of the
world’s trading nations and ratified in their parliaments. The goal is to
ensure that trade flows as smoothly, predictably and freely as possible.

The WTO has over 160 members representing 98 per cent of
world trade. Over 20 countries are seeking to join the WTO.

Despite MPs voting against a no deal in March 2019, it still
remains the legal default for Brexit until some kind of withdrawal
agreement is passed by Parliament. A no deal Brexit would mean we
leave the EU, as well as the single market and customs union, and
begin trading with the EU on WTO terms.

Under WTO rules, countries set their own import rules,
so a no deal Brexit means that the government could, in theory, allow goods and
services from all countries across the world to be imported into the UK without
tariffs or quotas.

But it doesn’t mean other countries would have to do the
same, meaning that UK exports to those countries would, in many cases, face
tariffs and restrictions.

In any case, the government have said that under a no deal
Brexit scenario, tariffs would still apply to 13% of goods (by value)
imported into the UK for up to 12 months. During that time it will undertake a
review on a long-term approach to tariffs. 

Another way of thinking about free trade is that the UK
would be able to decide for itself how trade with other countries would
operate. In the longer-term a no deal Brexit would give the UK the greatest
agency over its future trade deals, although the exact terms would have to be
agreed in negotiation with each individual country. These deals would likely
take years to negotiate. Source: https://fullfact.org.

Formation	1 January 1995; 24 years ago
Type	International trade organization
Purpose	Reduction of tariffs and other barriers to trade
Headquarters	Centre William Rappard, Geneva, Switzerland
Membership	164 member states
Official language	English, French, Spanish
Director-General	Roberto Azevêdo
Budget	197.2 million Swiss Francs (approx. 209 million US$) in 2018.
Staff	640

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