Businesses need to enjoy “barrier-free” access to the European Union once Brexit negotiations have been completed, the CBI has warned.
Britain’s biggest business lobby group said in a report that the country should be free of tariffs with “minimal” non-tariff barriers across every sector.
Non-tariff barriers cover restrictions that result from prohibitions, conditions, or specific market requirements that make importing or export difficult but do not have direct costs. Tackling them is, considered by economists to be more important than external tariffs in order to make Brexit a success.
The report said: “There are some companies for whom avoiding high tariffs on their goods trade is critical and others who prioritise avoiding non-tariff barriers to trade, particularly around services.
“It is clear that, for the UK’s modern, interdependent economy, additional barriers to any sector’s trade will be detrimental to other sectors. A new arrangement with the EU must therefore be open and comprehensive, covering goods and services, tariffs and non-tariff barriers.”
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The CBI said that it had conducted the widest consultation with members since before the referendum and emphasised that no sector should be left behind during negotiations. It said that in order to make a success of Brexit, the UK needed a “whole economy” approach to make sure individual sectors were not penalised.
The report spoke to every sector of the economy, from agriculture to utilities, with many concerned about access to skilled labour and tariffs if the UK fails to be given any access to the single market.
Carolyn Fairbairn, director-general of the CBI, said: “Leaving the EU will be a highly complex process, and all sectors of the economy are making their priorities clear in order to get it right. The government will need to take a ‘whole economy’ approach to avoid leaving sectors behind.”
The CBI also reiterated its call for a “smooth exit” from the EU, saying that it was critical to avoid a “cliff edge” break-up if there was no new trade deal in place when Britain finally leaves.
In response to the CBI report, a government spokeswoman said: “We agree with the CBI that we want a smooth and orderly exit that works for all sectors of the UK economy. That is why we have been engaging intensively with businesses across the country, building a strong understanding of the challenges and opportunities that Brexit brings.”
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The fears: from farm to restaurant table
Agriculture Any new immigration system must take into account that two thirds of the 34,000 workers not born in Britain who are employed in agriculture are EU migrants, the agriculture sector has said. The industry is also concerned about high tariff and non-tariff barriers to EU trade and wants further assurances on funding for rural economy.
Aviation It employs nearly one million people and is asking how the government will seek agreements that allow the smooth transport of holidaymakers, workers and goods. Says leaving the EU must not disrupt the UK’s access to the Single Market for Aviation.
Restaurants/Food and drink Much of the regulation of the food and drink industry is from the EU, and the sector is looking for stability and certainty around mutual recognition of regulations. Restaurants are asking how they will continue to hire chefs from abroad.
Non-graduate EU workers play a vital part in the food and drink industry and as such reassurances and continued access to workers is important.
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Construction The sector that will build Britain’s homes, roads and rail and is worth more than £100 billion is asking about the potential costs of importing materials and the future of the CE (Conformité Européenne) marking scheme, which shows goods meet EU legal requirements and can be sold in the European Economic Area.
Creative industries Employs nearly two million people across music, film, video games, architecture and more. Wants to know the future of Intellectual Property law. Says long-term mechanisms for regulatory co-operation may have to be sought.