Brexit: no deal means no trade for the UK, claim economists
Economists have warned that trade is likely to come to a halt if the UK fails ...
Concerns are mounting that even with a Brexit deal that is relatively soft, there could still be considerable freight congestion at some of the major arteries into the UK – especially at the port of Dover and along the UK-Republic of Ireland border.
Ireland’s revenue commissioner, Liam Irwin, yesterday gave evidence to the Irish parliament’s finance committee and warned that, under EU law, 6-8% of all freight crossing the border would need to be checked.
Although he qualified this by adding that a large proportion would simply involve documentation checks rather than physical inspections.
Pauline Bastidon, head of European policy at the Freight Transport Association (FTA), today said that with 6,000 cross-border vehicle movements every day in Ireland, this could mean as many as 500 daily checks, which could cause considerable congestion.
“We are pushing for the number of checks to be minimalised as much as possible, and [they be] subject to intelligence-based methods as much as possible as well,” she said.
However, she added that both the UK and EU negotiators had recognised, even at this early stage, that Ireland would be “a special case”.
She said: “As the only land border the UK has with the EU –not just a landbridge but with many businesses operating on an all-Ireland basis – with a high dependency on trade, both the UK and EU have recognised that Ireland is special case in these negotiations, and the EU says it is willing to a develop a specialised solution.”
Mr Irwin suggested Ireland would look to do the inspections at “trade facilitation posts” 10-15km from the border to try to minimise disruption.
There are also growing concerns about what might happen at Dover, given that new French president Emmanuel Macron says he wants to renegotiate the Le Touquet agreement, by which France and UK agree the UK border begins at the port of Calais.
Ms Bastidon said: “Mr Macron has called for a renegotiation of the treaty, but without giving much details. However, we are worried that this will involve moving the border back to Dover, and this is an issue because of space restriction at the port.
“If this happens there is a possibility that the frequency of ferry services might decrease, because of the physical set-up of the port, which could bring huge costs.
“We estimate that each minute that a truck is delayed would result in an extra cost of £3.21, so you can imagine how this will add up if these delays become disproportional.”
Chris Welsh, FTA director of global and European policy, said the association was also lobbying UK government departments to understand what was at stake for shippers and their freight service providers.
“Border controls will be absolutely key and we are trying to make the DFT and other government departments aware of potential problems, such as new border controls and customs procedures.
“With the UK likely to leave the single market, this will require something like 300 million new customs entries to be processed, and we are engaged to make sure that Customs’ CHIEF system and its successor is able to process those.
“We are also trying to ensure that custom clearance takes place away from the borders, and get into place some sort of trusted partner programme so that clearance could even be done at manufacturing sites,” he added.
What the ultimate UK-EU agreement will look like remains unknown, but FTA executives said that at least the sequence of negotiations was now clear and would be in four stages.
The first, an agreement on the withdrawal process, has already been completed, and the European Parliament is due to vote on 22 May to adopt the Article 50 negotiation process and mandate the European Commission to conduct the negotiations.
A second phase will discuss the framework of the future UK-EU relationship, which will mean agreeing the future status of EU and UK citizens living and working in the respective territories, while a third phase will need to agree on the transitional model of the relationship.
The fourth stage will concern the creation of a free-trade agreement between the UK and the EU, but will only be concluded after Brexit has taken place.