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Trade Committee states that the Government is still unclear on trade after Brexit

Simon Lovegrove
March 10, 2017

Posted in WTO and international trade

The House of Commons’ International Trade Committee (the Committee) has published its first report identifying certain issues that it believes the Government should resolve as it prepares to trigger Brexit negotiations.

In particular the Committee:

  • calls on the Government to publish a White Paper about the possibility of the UK re-joining the European Free Trade Association;
  • sets out some of the terms that the Government should be seeking in negotiations with the EU as regards a free trade agreement. In addition, the Committee calls on the Government to clarify what exactly it means when it says that it does not want a customs union with the EU but is looking for a “customs arrangement”; and
  • urges the Government to set out as clearly as possible the likely consequences of the World Trade Organization option and to ensure that it makes contingency plans for this eventuality.

Committee Chair Angus MacNeil commented:

“The Government is about to embark on a process that will transform our trading relationships in Europe and across the globe. They must set out their vision for UK trade after Brexit – and provide reassurance that contingency plans will be in place for the eventuality that we don’t get an agreement with the EU.

We are entering unchartered waters. The trading relationship we have had with Europe for almost 50 years will be transformed. World trade is often in a state of change, for example from 1948 to 1973 UK-Commonwealth trade fell from 38% to 18% of both parties’ total trade; that trading network was in decline long before the UK joined the EU.

We are now in a very new phase and the Government has to give us more information on what this means for UK trade and the economy.

Key industries will want to know as soon as possible what the likely outcomes are and their consequences. The Society of Motor Manufacturers and Traders predict that, under WTO tariffs, the price of an imported car would rise, on average, by £1,500. The National Farmers Union foresee a possible fall in farm incomes of €17,000 a year, if combined with the full abolition of direct support.”

View Government still unclear on trade after Brexit, 7 March 2017

This briefing also features as a post on our Financial services blog: Regulation tomorrow.

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