Tony Burke: The UK’s plans for keeping EU trade deals after Brexit are in turmoil

The Confederation Of British Industry has just issued a stark warning for UK International Trade Secretary Dr. Liam Fox.

The organisation has said he will not be able to deliver on his promise to ‘roll-over’ Britain’s forty existing free trade deals with non-EU countries in time for Brexit day – and argue a failure to secure the deals could “wipe out” entire sectors of the UK economy.

A wildly optimistic Dr. Fox promised – photocopier at the ready – to ‘roll-over’ Britain’s existing deals with non-EU countries, as part of its EU membership. In his words, this would be the ‘second after’ Brexit.

But according to Business Insider UK, the CBI’s chief trade spokesperson, James Ashton-Bell said this week that: “The UK fundamentally lacks the experience or the bandwidth to conduct twenty or more trade renegotiations in parallel to complete before the potential “cliff edge” of January 2021.

“The potential of a “cliff edge” for these agreements is very real, and potentially hugely damaging at both firm level and for entire sectors of the UK economy. It could wipe some out overnight. Some export reliant companies could literally go bankrupt.”

The Department for International Trade however continues to repeat the mantra that Britain’s existing free trade deals can be carried over minus any renegotiation in a ‘smooth transition’ – ignoring the basic fact that in any renegotiation the other side will want concessions and changes.

As the CBI says, the DIT has not got the capacity to do the deals and says those ‘third countries’ which made concessions to the EU may no longer be willing to give them to the UK standing on its own after Brexit.

A number of UK business leaders, who are meeting with DIT officials, are privately scathing of Liam Fox, according to Business Insider UK. One is reported to have said that he feels sorry for the civil servants: “To be honest it’s a nightmare job. Fox is not the brain of Britain.”

Another echoed concerns about Fox’s leadership: “Officials inside DIT confess that there is a lack of direction from the top on where to prioritise effort and how to choose which areas are of most importance.”

It is also claimed that the DIT had been reluctant to accept advice from industry. The ‘we know best’ attitude is reflected in comments from another business leader who said: “Officials have repeatedly turned down offers from business to help both with the technical aspects of the agreements and with engaging governments and businesses in the countries concerned.”

Since the Brexit vote Fox and the DIT has talked up the prospect of securing trade deals with China, New Zealand and Australia. The right wing media has backed ‘easy win’ fantasies like piggy backing on negotiations such as NAFTA, TPP or reviving TTIP.

And the prospect of joining the ‘Norway’ EEA/EFTA agreement is not even on the drawing board, according to Norwegian union officials and journalists who expressed their alarm at the very idea, at a joint meeting and press conference on Brexit with Unite recently in Oslo.

A recently leaked EU analysis also suggests that trade deals cannot be simply ‘rolled over’ with signed agreements between the UK and the EU – as the DTI promises will happen. The report produced for MEPs by the European Parliament’s Research Service “Brexit and the UK participation in existing EU trade agreements” says: Brexit “would require a renegotiation of trade deals thus giving the opportunity to third countries to require more concessions from the UK.”

The European Commission has warned other EU institutions that it is “deeply concerned” about the UK’s lack of preparation for carrying over trade deals after Brexit. The Commission cited Fox’s “failure to grasp basic concepts and trade-offs” relating to the ‘roll over process’.

Business Insider UK reports one former senior UK government official saying: “Frankly, the DIT been messing around for months and not doing any of this. Most of the people who are having to deal with this are totally ignoring reality.”

As one noted EU trade expert who works with trade unions said: “The problem is that Fox has ‘delusions of grandeur’ in imagining that other countries are all willing to sign at the drop of a pen. The fact is that the UK and our industries are vulnerable. Other countries know it and will extract their pound of flesh.”

Fox himself has done little but rack up air miles, chasing phantom deals notably with the USA, where his and Theresa May’s stock has shrunk to minuscule levels – witness the Bombardier tariff crisis earlier this year, where Trump cold shouldered both the PM and Fox, as well as the recent Trump steel tariffs debacle which saw Fox again jetting to the USA and coming back empty handed.

The DIT’s failure to grasp the impact of not being able to automatically ‘roll over’ trade agreements, or see the lack of any sign of securing a trade agreement with the EU (which will provide the same benefits of being in the single market – as promised) – continues to sound alarm bells among trade unions, and employers – notably in our hard pressed manufacturing sectors.

This article originally appeared on Left Foot Forward.

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