Negotiations on Brexit are starting in earnest this week with the focus on transition arrangements. While much of the discussion in the run-up to the talks has been on the prospect for “frictionless trade”, the friction between the two sides has been all too obvious.
Last week, prime minister Theresa May set out her vision for the movement of goods post-Brexit in a speech at the Mansion House in London, re-iterating her desire that UK-EU border trade should be as frictionless as possible.
“That means we don’t want to see the introduction of any tariffs or quotas,” she said repeating the two options she set out last year. The first option is a customs partnership between the UK and the EU. The second is a streamlined customs arrangement that would minimise border delays.
The impact of border restrictions was highlighted by the deputy mayor of Calais last month. Speaking to the BBC, Philippe Mignonet warned that the introduction of border checks would lead to traffic queues of up to 15 miles at Calais.
The warning was not lost on the Freight Transport Association. Deputy chief executive James Hookham said: “FTA has been warning for some time of the potential risks of the introduction of border checks at Dover and the importance of doing everything possible to keep Britain trading. Now we can see there are similar concerns about gridlock on the French side of the border. The government and our EU negotiating partners need to take these issues seriously and prioritise practical trade arrangements.”
Nevertheless, in all their public pronouncements EU leaders are continuing to play hardball. In a tweet last week, European Council president Donald Tusk made clear his belief that trade friction was an inevitable consequence of Brexit. “Let’s be clear: there can be no frictionless trade outside the customs union and Single Market. Friction is an inevitable side effect of #Brexit. By nature.”
And chief negotiator Michel Barnier warned companies that they would need to be ready to adapt their supply chains ready for when the UK leaves the European Union on 29th March 2019.
Speaking at BusinessEurope Day 2018, Barnier said: “The future of our Union is more important than Brexit.”
He was clear that certainty about the transition would only come at the end of the negotiating process with the ratification of the withdrawal agreement by both sides –probably early next year.
And in a telling phrase, he said: “We must not lose sight of the key point: the Single Market is what makes our businesses in Europe strong.”
So, while May is firing out signals of her willingness to compromise, Barnier is doing the exact opposite.
Industry organisations like the FTA have put a lot of effort into persuading the UK government of the need to minimise trade barriers – with a significant degree of success.
Perhaps, it is now time for industry to step up its focus on the negotiators from Brussels.
