UK open to looser 'Australia-style' trade deal with EU - source

LONDON - British Prime Minister Boris Johnson would consider a looser trade agreement with the European Union, similar to the bloc's ties with Australia, rather than follow EU rules to reach a closer deal, a government source said on Saturday.

"There are only two likely outcomes in negotiation - a free trade deal like Canada or a looser arrangement like Australia - and we are happy to pursue both," the source said.

Johnson is due to give a major speech on trade on Monday, following Britain's departure from the EU on Friday after nearly 50 years of membership.

Previously Johnson has said his main goal is to reach a Canada-style trade deal with the EU before an 11-month transition period expires at the end of the year, after which British firms would face tariffs to sell goods to the EU.

But Johnson has also said Britain will not commit to continue following EU rules after the transition period, and Saturday's remarks suggest he is growing less willing to make the trade-offs that many businesses want to smooth a deal.

Canada does not follow EU rules, but some EU governments are reluctant to give Britain similar leeway to diverge on labour and environmental standards, given the much greater trade volumes involved.

In some areas, such as the minimum wage, maternity leave and the elimination of single-use plastics, British standards significantly exceed EU minimums. 

Reuters