Brexit means Brexit; bespoke deal; best possible deal; unique and close relationship; customs union that mirrors the existing one; frictionless trade; etcetera may make fabulous soundbites for the casual consumer of news and economic analysis, but they provide no details and give no platform upon which businesses on either side of the channel can make strategic decisions upon.
When the UK provided notice to the EU of its intention to leave the bloc this March, it started a two-year process designed to permit the disentanglement of the UK from its 27 partners which will remain in the EU. Once that process is complete (and in principal only then) the UK, as a third-party nation, will be at liberty to discuss its future trading relationship with the EU. If that model is followed to the letter, then the UK will cease to be bound (or protected) by a vast range of EU agreements relating to everything from “open skies” which governs EU air transport to the trading conditions with many nations that have bilateral trading agreements with the EU. The EU would be required to enforce customs checks on UK goods entering the EU and the UK would need to check goods flowing in the opposite direction despite neither party having infrastructure in place to do it. The complexities of the separation are immense and will affect all aspects of life in the UK from transportation of medicinal radionuclides used in cancer therapy to the price of the food we buy in our supermarkets – it makes the labours of Hercules look like the work of an idle slacker by comparison.
Unsurprisingly, business would like a dose of certainty. A delegation of European business leaders met with the PM in Downing Street yesterday. The 14-member delegation, organised by BusinessEurope warned the PM that a failure to commit to the Brexit divorce settlement and move matters forward could trigger a collapse in economic confidence in the UK. The group highlighted concerns over the future for businesses in automotive, aerospace and pharmaceutical sectors that could be affected by WTO tariffs if there is no deal. The CBI’s Carolyn Fairbairn presented a survey which indicated that 60% of UK businesses will need to make contingency plans by March 2018 if no assurances are given over a transitional agreement.
BusinessEurope’s president Emma Marcegaglia, put things starkly: “This is very, very bad. If don’t have certainty, they will simply go away.”
Downing Street’s spokesman offered the usual platitudes that had done nothing to reassure the group (or anybody else) in the past:
“The prime minister reassured the group that Brexit meant the UK was leaving the EU, not Europe, and reiterated her ambition for free and frictionless trade with the EU27 once the UK departs. She also expressed her commitment to giving businesses the certainty they need by agreeing a time-limited implementation period as soon as possible.”
Brexit means Brexit, of course.