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Superforecaster Fridays: When will the UK and the EU sign a trade deal?

EURASIA GROUP
28 February 2020

The Superforecasters currently predict that there is a 41% chance the European Union (EU) and the United Kingdom (UK) will sign a trade deal before the end of 2020, up from 19% on 7 February. If the deal is not secured by this year's end, the Superforecasters see a cumulative 25% chance that it is signed in the calendar year 2021 and a 34% chance that is signed in 2022, beyond, or never.
Both sides have hardened positions ahead of next Monday's start to trade talks. 10 Downing Street has seriously ratcheted up its rhetoric, perhaps anticipating that economic concerns arising from the coronavirus outbreak will lead the EU to soften its position and make concessions on the single market. This increases the risk of miscalculation. Additionally, we believe Macron-led France will play a hardline role and have disproportionate influence over the terms of the overall agreement.
This week Eurasia Group increased the odds of no UK-EU free trade agreement (FTA) from 15% to 30% and reduced the likelihood of a deal from 60% to 55%, as both sides' toughening approach to negotiations limits the space for agreement.
Our revised assessment is also driven by the fact that the outcome of UK-EU trade negotiations will be binary—either a “zero tariff, zero quota” deal or a reversion to World Trade Organization (WTO) terms; a messier, compromise solution would be too complex to negotiate in the limited time available.

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Each Friday, Eurasia Group clients have the opportunity to submit potential forecast questions to the Superforecaster network. Selected questions are reported back to clients each week, with periodic updates provided on previous forecast questions. Good Judgment® helps clients quantify subjective risks for better decisions. Their cutting-edge methods and network of professional Superforecasters deliver accurate and early foresight. Learn more about this forecast and Superforecasting™ techniques here.

Superforecaster Fridays: When will the UK and the EU sign a trade deal?

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