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Business groups slam new export rules

By Jonathan Powell in London | China Daily Global | Updated: 2021-01-11 06:10
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FILE PHOTO: Customers shop for fruit and vegetables inside a supermarket in London, Britain August 7, 2019. [Photo/Agencies]

The United Kingdom's leading business groups have demanded that trade negotiations with the European Union be restarted immediately as cross-border friction caused by post-Brexit rules and regulations threaten UK exports to the EU.

Trade organizations met Cabinet Office Minister Michael Gove in an emergency session on Thursday to inform him of major issues with the exports process that they had been assured would not exist.

Companies have spoken out about paperwork delays at ports, and some retailers have temporarily suspended sales to customers in the EU. The UK government has stated it was always clear there would be some disruption at the end of the Brexit transition period that ended on Dec 31. It said traders and hauliers must take steps to comply with new border rules.

Prime Minister Boris Johnson had promised his "zero-tariff" and "zero-quotas" deal would preserve free access to the bloc's single market.

But according to UK business groups, the deal was rushed and many of the problems are due to the complexity of arrangements, including "rules of origin", that have not been fully resolved. It means only goods made mostly of parts that originate in the UK would qualify as tariff-free.

The EU seeks a high degree of alignment by the UK with its standards on workers rights, the environment and particularly state aid for businesses, or the so-called level playing field, and wants to protect against the UK becoming a low-regulation economic rival.

Britain's departure seems well short of pain-free, and one attendee to the emergency session with Gove was quoted by The Guardian as saying that the minister seemed "very concerned" at hearing reports of problems.

The source said: "He seemed to realize the full gravity of the situation that is unfolding and about to get worse."

Gove on Saturday warned all businesses to brace for "significant border disruption" as more of the effects from rule changes emerged.

Stephen Phipson, chief executive of the manufacturers' organization Make UK, was quoted in The Guardian saying many EU trade issues still needed to be cleared up.

He said: "Industry welcomed the trade agreement that avoided the catastrophe of no-deal, as tariffs and quotas would have been a disaster for exporters. However, this is only a starting point, as there are still substantial issues that need ironing out, with many months, if not years, of tough negotiations ahead."

The UK car industry has deep concerns about tariffs, as components it uses in manufacturing are sourced from many countries.

Phipson said: "Having built up seamless and complex supply chains over decades, the automotive sector in the UK is facing a jolt to its systems that places its very future under threat."

It has also emerged that in its negotiations with the EU last month, the UK rejected an offer of visa-free tours by musicians to EU countries, a decision that has enraged artists.

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