Last reviewed 5 August 2022
It may be several weeks before the UK knows the identity of its new Prime Minister but, whether it is Liz Truss or Rishi Sunak, their in-tray will be dominated by international trade issues.
This is the view of the British Chambers of Commerce (BCC) which has warned that the prospect of a fully-fledged trade dispute between the UK and the EU is drawing ever closer.
Having completed its Commons stages, the Northern Ireland Protocol Bill has been introduced into the House of Lords. If adopted, it will give UK Ministers the legal powers to over-write the Protocol and introduce check-free, friction-free movements of goods across the Irish Sea between Great Britain and Northern Ireland (and vice-versa).
Arguing that this will expose the EU single market to unchecked goods, the European Commission is expected to respond by launching legal proceedings against the UK Government for alleged breaches of the UK-EU Trade and Cooperation Agreement (TCA).
Should the Government push ahead with its plans, the BCC believes that the Commission will respond with further actions including safeguard measures (tariffs) on selected UK exports to the EU while the whole matter is resolved by the TCA dispute resolution machinery.
“The BCC is prioritising a negotiated solution,” it said, “but potentially affected companies should be taking advice now to mitigate their exposure to new costs on exporting goods to the EU should matters worsen.”
The BCC also notes that an autumn campaign on preference utilisation rates among SMEs is being prepared for roll out. It is involved in discussions with the Government about this, following research findings from members that awareness and ways to use new trade agreements being made by the UK with other trading partners was very low.
The aim is to increase volumes of exports and numbers of companies exporting. Initially five markets will be prioritised: Australia, New Zealand, Singapore, Japan and Norway.
The new Prime Minister will also be faced with key trade negotiations with India, Canada, Mexico, Israel, the Gulf Co-operation Council (GCC) and the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP) so, as the BCC concludes, a busy autumn ahead.