“The fact that the United Kingdom (UK) and the European Union (EU) have reached an agreement on Brexit after complex negotiations will be generally welcomed in view of the wider implications of 'hard' Brexit for key components of the world trading system.”

This is according to Prof Raymond Parsons, a well-known economist and academic from the North-West University (NWU) Business School.

“Although South Africa and the South African Customs Union recently signed an agreement with the UK to ensure continuity in the tariff regime, irrespective of the Brexit outcome on 31 October, major shifts in tariff arrangements inevitably generate unintended consequences in a highly economically integrated world,” he adds.

Prof Parsons says, for the latest Brexit deal to become entrenched, it will still need to develop momentum and enjoy further political support in both the UK and Northern Ireland. 

“The next key step is for the UK parliament to decide on 19 October whether it will back the deal or not. There remains much to play for at different political levels in the UK in order to make the latest Brexit outcome irreversible.”

He adds that the emergence of a UK-EU Brexit deal at this stage has nonetheless reduced the risk of the UK “crashing out” of the EU without a deal on 31 October, which would have incurred high economic costs. 

“There would immediately also have been serious disruptive logistical consequences for all countries doing business with the UK, including South Africa. A smooth and orderly Brexit remains first prize for both the UK and the EU in terms of their respective economic futures and their trade relations with third world countries.”