BORIS Johnson implies that we can ‘get Brexit done’ by December 2020, at the latest, and that a deal is ‘oven-ready’. This is a misleading and dangerous fallacy, and he and his colleagues must know that, as the EU Withdrawal Bill begins to pass through Parliament.
He has committed himself to a substantial change in existing relations with the EU in order to ‘take back control’, and to simultaneously negotiate an external trade deal with the USA and others.
But the agenda to achieve these objectives is risky, massive and time consuming. It will require a detailed, line by line, assessment of tariff arrangements for hundreds of thousands of transactions in goods and services, which would be conducted alongside equally complicated talks with the US in a new trade deal.
Additionally, all existing external EU trade arrangements, which the UK enjoys as a member, will have to be renegotiated, with the UK being the weaker negotiator. These processes may take several years to complete. The PM’s present approach would have serious consequences for several pan-European industries heavily invested in Britain but which require fast tariff-free movements of goods and components across the EU.
Automotives, aerospace and pharmaceuticals are all large employers who could relocate away from Britain. It would be impossible to replicate such arrangements with the USA because the distance would make ‘just in time’ arrangements impractical.
After 40 years of close engagement with the EU’s common agricultural policies, a withdrawal would be essential in order to complete a deal with America, who will insist on a farm deal which would be unacceptable to the EU.
This would also raise health and safety concerns with consumers and pressure groups in the UK. It beggars belief that an agreement which reconciles these contrasting views could be achieved in 12 months.
The UK is a signatory to the Paris Agreement on climate change, which the US is not. Furthermore, this country applies extensive EU environmental regulations which will have to be renegotiated or abandoned, to satisfy the Americans.
EU competition rules are frequently at odds with those of the US. For example, the US accuses Airbus, a large employer in the UK, of anti-trust activities, and the EU is, for the same reason, highly critical of Boeing. The EU is also critical of many of the activities of the US internet companies. How will these differences be reconciled in a US trade deal?
Several other matters need to be resolved if Johnson’s present Brexit approach is going to be delivered. Brexiters insist that Britain withdraws from the Common Fisheries Policy, but there are awkward issues.
A substantial proportion of the fish landed in British ports is exported, tariff-free, to the rest of the EU. Much of the fish consumed in the UK is sourced from the EU. Strict quotas are applied in European waters to restrict overfishing. Boats fish in other countries’ waters. Will all this be resolved satisfactorily in 12 months?
Outside the single market, new regulatory burdens seem inevitable if strict controls are applied on Europeans coming to work in Britain. They will have to be designed carefully if key sectors such as health, hospitality and agriculture are to remain viable.
Taking all the above into account, and much more, the December 2020 deadline will be another commitment which the Prime Minister may be unable to fulfil unless he backs a softer Brexit. This would mean that the UK would leave the EU as demanded in the 2016 referendum, but would continue to be part of the Single Market and the Customs Union.
It would require a simple and speedy renegotiation which, in turn, would restore the confidence of the markets and businesses. It would rule out the possibility of a trade deal with the US, or other countries, which was incompatible with the single market. But the many complexities and risks arising from a US deal would also be avoided. Scottish and Irish concerns would be allayed. A soft Brexit reduces the regulatory burden.
I recognise that this is less attractive than ‘Remain’, but it seems to be the more sensible way of healing the wounds arising from the referendum, and enabling the Government to give more attention to the other great economic and social issues which have been neglected in the past three years.
Lord Haskins of Skidby is a peer, farmer, businessman and outgoing chair of Humber LEP. He is writing in a personal capacity.