Engineering Brexit

Manufacturers need a Brexit deal that ensures the UK retains tariff-free movement of goods to Europe and a flexible approach to accessing EU labour, writes Hywel Jarman

The United Kingdom has voted to leave the European Union, which will present challenges for the sector but could ultimately bring new opportunities. The UK’s manufacturing sector and its customers require certainty and clarity on the trade and business relationships that will be in place with the EU from March 2019.

Businesses need to be able to plan, make investment decisions and have confidence that an orderly and carefully-managed approach to Brexit is underway. The longer a delay in knowing the probable shape of the economic and business environment, the more this will divert investment decisions away from the UK.

Business cannot wait until the end of the negotiation period for confirmation of a deal or the details for the future trading relationship.

Over eight in 10 manufacturers – 84 per cent – export to the EU and three out of four state that a tariff on exports to the EU would have a highly negative impact on their business. Manufacturers have been consistently clear about their priorities since June 2016. Our sector’s key concerns are that the UK retains the tariff and administrative free movement of goods to Europe and a flexible approach to accessing EU labour.

We strongly support a transition period before formal and final exit that maintains the economic benefits of access to the EU on the same trading terms as now, and thereafter with minimal of tariff and customs arrangements. Such a period will allow efforts to be made to achieve a truly comprehensive free trade agreement. This is essential for business planning, certainty and for supporting exports.

In order for manufactured goods from the UK to move across EU borders, we are also seeking regulatory equivalence, mutual recognition of standards and an agreed process to eliminate or prevent non-tariff barriers behind the border on an ongoing basis.

Access to skills is a major concern for UK manufacturing. The sector is already struggling with a significant and well-documented domestic skills shortage. We must ensure that a flexible system for the movement of labour and skills between the UK and the EU continues.

UK and European manufacturers agree a deal that works for trade and reduces the risk of economic shocks is paramount. It is vital that the process for the UK’s departure from the EU and the trade arrangements that follow deliver a deal that minimises disruption for industry across the European Union and in the UK.

The UK is the fifth largest economy in the world, the ninth largest manufacturing nation. We have some of the most productive companies in the world. Logic demands that the UK and EU will not dismantle the best free trade relationship in the world and in doing so harm many thousands of businesses and all 500 million citizens of the 28 countries of the EU.

As manufacturers we will continue to press for a smooth and orderly Brexit, one that will deliver continued prosperity and investment in jobs and economic growth.

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Hywel Jarman is director of external affairs at EEF.

Join Progress and EEF at Labour party conference in Brighton for: ‘Engineering Brexit: What does Britain’s manufacturing sector need from Brexit?’ at 8am, Sunday 25 September.

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