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Analysis

Britain’s magical thinking on EU trade

by Alan Wheatley | 15.08.2017

The British government deserves top marks for imagination in its eagerly awaited suggestions for preserving the “freest and most frictionless trade possible” with the EU post-Brexit.

The proposals in Tuesday’s position paper on future customs arrangements fall squarely under the category of wishful thinking. They are unlikely to survive first contact with the EU’s army of negotiators.

But let’s suppose they do. As the paper acknowledges, British business will be tangled up in new red tape: “There will remain an increase in administration compared with being inside the EU customs union.” The cost of the fatuous pursuit of taking back control of our borders is thus laid bare: added costs for business will lead to higher prices in the shops, throw sand in the gears of intricate supply chains and make firms think twice before investing in the UK.

The UK plan envisages either a “highly streamlined customs agreement” that relies on technology to minimise disruptions to trade or a “new customs partnership” with the EU that would somehow, magically, obviate the need for any customs processes at all. With typical British understatement, the paper says such a partnership would call for an “innovative and untested approach”.

It all reads like a clever stab at an impossible-to-answer exam question.

Guy Verhofstadt, the European Parliament’s Brexit coordinator, immediately saw through the sophistry. “To be in and out of the Customs Union & ‘invisible borders’ is a fantasy,” he tweeted.

The government’s intention to negotiate free trade deals with non-EU countries during a transition period once we have left the bloc in March 2019 also quickly ran into opposition, including from the Czech secretary of state for EU affairs.

The aim of the “agreement” and “partnership” mooted by the paper is to preserve the existing friction-free trade in goods and services. But European leaders have always insisted that any third country that wants to enjoy the benefits of the single market must also accept free movement of people – and contribute to the EU budget. No cherry-picking is Angela Merkel’s pet phrase. But that’s what the UK paper seems to boil down to.

Brexiters want to distance the UK from the EU. So it is supremely ironic that the idea of a customs partnership would entail us having an import regime that “aligns precisely” with the EU’s customs border for goods. Indeed, Britain would end up collecting import tariffs on behalf of the EU. Why would the other 27 member countries agree to go along with such a cumbersome, “untested” regime just to please their awkward neighbour?

Boris Johnson was mocked for unabashedly saying his policy towards Brexit was to have his cake and eat it. But Boris is having the last laugh. Judging by Tuesday’s position paper, having your cake and eating it is now official government policy.

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Edited by Luke Lythgoe

7 Responses to “Britain’s magical thinking on EU trade”

  • Not surprising really because both Fox and Davis appear to be in their own small minded and xenophobic Fantasy-Land.

    Don’t hear much from Johnson these days, perhaps because he’s busy sharpening his knives for a stab in May’s back.

  • What a load of fantasists the British politicians are, it is not rocket science to know how the EU is constituted, at least the civil servants should know, but do they?
    They should be shouting at the politicians that it is impossible under EU regulations to ‘have your cake and eat it’.
    There are rigid principles laid down in the original EU charter, modified by treaty only, that are the cornerstones of the EU.
    Nobody will agree to vary those for anybody, including Britain.
    So they include, free movement and unhindered access to jobs and contracts, with tariff free trade between member states. Those are cast in stone and will not be changed for brexit.
    We already sit outside the Schengen area, which means stronger free movement controls between Britain and most EU countries, why should the EU members consider any further movement restrictions?
    They will never agree to tariff free trade without suitable and substantial financial support.
    There is no possible ‘deal’ that our government can do, that leaves us any better off than we are as full influential and powerful members of the EU.
    But of course, May, Johnson, Gove et al., know much more than I do? I only have a Masters in UK and European Public Policy!

  • The EU does not have to bend over backwards to accommodate British supposed exceptionalism, or to undermine it’s own position. German industry say they are more concerned with not upsetting their 93% of customers who are not British and they also wish to see the Single Market maintained and not picked apart.

    As usual, the EU is being consistent, as the British government and Labour position shifts and morphs, while the Tories foolishly snipe at the people they need to feed their begging bowl, which is about all they have to offer.

    None of this will work and we will have a European future.