One of the UK’s leading employer groups has warned traders that it will not only be their links with other EU countries which will be broken in the event of a no-deal Brexit.
The CBI has highlighted that the UK currently benefits as a member of the Union from 40 trade agreements, spanning five continents, but that nearly all those arrangements will fail unless a deal is reached with the EU or specific arrangements are made with each country to carry the benefits forward.
Questioning Trade Secretary Liam Fox, Parliament’s International Trade Committee pointed out that, with only a few weeks to go before 29 March, only agreements with Chile, Switzerland and the Faroe Islands have been announced.
CBI President John Allan said: “If the UK leaves the EU without a deal, we could cease overnight to enjoy the benefits of tariff-free trade with, and preferential access to, markets of fundamental importance for British products and services, from Japan to Turkey.”
From rapidly growing creative firms trading with South Korea to specialist machinery firms trading with Mexico, he went on, these EU Free Trade Agreements (FTAs) have supported firms of all sizes to grow but could be lost overnight.
Mr Allan said that UK exports to countries the EU has trade agreements with increased significantly after they came into force with trade with Canada up by 14% and exports to South Korea having grown by 67%.
The latest EU-Japan deal would have added £3 billion to the UK economy in the longer term, he predicted.
“This looming danger has been widely overlooked and is yet another reason to add to the lengthy list of why no deal is not an option for the UK economy, and is a great risk for jobs in local communities,” Mr Allan concluded.
Last reviewed 8 February 2019