Responding to International Trade Secretary ’s speech, the Institute of
Directors has urged Government to consider a trade arrangement
with the EU that would balance the need to minimise costs for
manufacturing with the ability to sign new trade agreements with
the rest of the world.
Commenting on the speech, Allie Renison, Head of Europe and Trade
Policy at the Institute of Directors, said:
“We believe that the Government can square the circle between
pursuing its own independent trade deals with third countries and
ensuring businesses in the UK face minimal barriers to trading
with the EU. Keeping tariffs on industrial goods aligned with the
EU would still allow plenty of negotiating capital for future
trade deals, including with the US, while ensuring companies
avoid costly rules of origin that could jeopardise foreign
investment into UK manufacturing and disrupt the UK’s integration
within European supply chains.
“Unlike Turkey, the UK’s trading ambitions are much more
developed as well as often being in line with the EU’s. Many
countries the UK wants to strike new deals with after Brexit have
already expressed their own reciprocal interest. Combined with
the fact that Brussels is already moving to improve Turkey’s
formal input into the limited areas where the EU’s tariff
preference changes are also extended to it, it is unlikely that
the problems of asymmetry, a key drawback for Turkey currently,
would apply in the same way to the UK.
“It is essential that the Government comes forward regardless
with a plan to ensure British companies are not detrimentally
impacted by applying costly country of origin requirements to
UK-EU trade, which could render a tariff-free deal with the EU
meaningless for much of UK manufacturing. Without at least a
partial customs union, it is unclear how this could be achieved.”
