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UK PM May Urged To Drop Threat Of No Brexit Deal By U Manufacturers


03/27/2017


UK PM May Urged To Drop Threat Of No Brexit Deal By U Manufacturers
Claiming that they would bear the brunt of trade barriers with the EU, U.K.’s Prime Minister Theresa May on Monday was requested to drop her threat that she might take the country out of the European Union without a new trade deal by Britain's manufacturers.
 
May was already has warned the other 27 EU countries that no deal would be better than a bad deal and she has plans to trigger the two-year Brexit process on Wednesday.
 
"The idea of being able to walk away empty-handed might be a negotiating tactic, but it would in reality deliver a risky and expensive blow," Terry Scuoler, chief executive of EEF, Britain's manufacturing lobby, said.
 
"The rhetoric from the UK government needs to focus instead on achieving a deal that will work for the UK and the EU."
 
May has conceded that Britain must give up its membership of the EU's single market and customs union in order to achieve control over immigration as she has decided to make that her priority demand and result for Brexit.
 
Default rules and regulations and tariffs of the World Trade Organization rules would be applicable for companies trading between Britain and the EU if there is an absence of a deal between the two parties.
 
High tariffs with an average of 5.3 percent could be faced by British manufacturing exports to the EU - such as cars, chemicals and machinery, the EEF has said. Stricter customs procedures and higher compliance costs cud be among the other risks that are posed as obstacles to trade for these manufacturers.
 
Britain's manufactured export to the EU a total of just over half of its products as measured by value. Due to a non Brexit, particularly exposed to any increase in trade barriers would be many of the factories that rely on goods and parts crisscrossing the bloc during production, and they would be left particularly exposed to these insecurities.
 
The EEF said a transitional period to ease Britain into its new relationship with the EU was essential and called for close consultations with the government on its Brexit strategy.
 
The government has not assessed the economic impact of leaving the EU without a new trade deal since last year's referendum, Britain's Brexit minister, David Davis, has said.
 
10 percent of Britain's economy is accounted for by manufacturing. Also worried about their future access to the EU's single market are companies in the much bigger services sector, especially in the banking industry.
 
Despite the risk of disruption in trade with the bloc, the government's plan to leave the EU customs union as the best way for Britain to strike trade deals with other countries, was welcomed by a think tank separately on Monday.
 
"The UK and the EU should aim for full customs cooperation as part of a comprehensive free trade agreement," Open Europe policy analyst Aarti Shankar said. "This is perfectly achievable, and the EU already holds customs facilitation agreements with other trade partners, including Switzerland and Canada."
 
(Sorcee:www.reuters.com)