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Published: 25 September 2017
May Brexit speech reaction
The UK Prime Minister's speech in Florence last week designed to give a kick start to Brexit negotiations has drawn a mixed response from industry
Mrs Theresa May offered a 2-year transition period after the A50 deadline in March 2019 to avoid the "cliff edge" scenario and agreed to continue paying into the EU budget for those teo years. It is speculated that the British government is looking at a contribution of £10M per year for those two years. There is still continued uncertainty, however, not least because the government is divided between hawks and doves as regards EU27.
For example, it is not clear whether the UK would agree to be bound by new EU law after Brexit. This is particularly relevant to UK ports because the Port Services Regulation, which is strongly opposed by the British ports sector, is due to come into force shortly before Brexit.
Immediately following Mrs May's speech last Friday, 22nd September, the British Ports Association's CEO Richard Ballantyne said that trade facilitation must be given a higher priority in the UK Government's Brexit negotiating position.
"With some notable exceptions, it's probably fair to say that most of the UK ports industry is relatively calm about Brexit although the wider impact on the British economy remains unclear," said Ballantyne.
"The challenge will be to find a solution that does not interrupt and delay the UK's roll-on roll-off ferry traffic, which facilitates thousands of lorry journeys between Britain and Europe each day. We are not there yet. By value this traffic represents a high proportion of the UK's international trade and delays will lead to higher costs for certain businesses and products which ultimately will be felt by traders and even consumers.
"In terms of the actual requirements the need to negate new customs declarations for EU trade and an agreement on common plant and animal health standards will be vital. These are needed to ensure that the large amount of food and agricultural products being transported between the UK and the EU is not subject to bureaucratic and costly checks and delays at the border, which could bring a number of the UK's busiest ports to a standstill."
Leaving aside deepsea PCTC calls, practically all UK ro-ro trade is intra-European. Within that sector, accompanied truck traffic - flow-through traffic with no "buffers" - is obviously the most exposed to border delays, particularly Dover straits traffic - no less than 47.8 Mt of goods in 2016, of which Dover-BoulogneCalais/Dunlirk 26.5 Mt and Le Shuttle "steel wheel truck ferry" 21.3 Mt, according to the latest Department for Transport data.
Meanwhile, Mark Watts, a former MEP, has issued a statement in his capacity as Coordinator of Brussels-based UKTie (UK Transport in Europe). He said that Mrs May's speech is "better than the cliff edge transport is particularly vulnerable to, but raises fresh challenges for our sector."
"The biggest challenge is that the transitional period is not seen here in Brussels as an offer, but as a request. It's seen as Britain acting out of weakness not strength, not least because of the ongoing divisions in Government and the growing strength of the Opposition Labour Party.
"So we have three major tasks ahead of us. First, supporting the Government in persuading our EU partners that a transitional deal is good for them, too.* Many of them now just want us out, and see Brexit as an unnecessary distraction. Events in Germany this weekend underline that.**
"Second, we need to ensure that during the potentially lengthy transition we continue to have a say over the regulations that will govern our industry. And third and finally, we need to continue to press the Government to deliver a position paper on transport, and provide greater clarity on issues such as customs and the Irish Question."
* This is a reference to the fact that a hard Brexit will cause chaos for non-UK EU hauliers, for two main reasons.
- Most hauliers involved in UK-Continent trades are non-UK EU hauliers. UK haulage companies have largely pulled out of the trade because of the migrants' situation and the fact that most of the goods are coming into the UK.
- Related to that, 30-40 mile long queues of truck drivers waiting to cross the Channel would be on the French motorways, not just on the British side!
** The right-wing Alternative for Germany (AfD) won 12% of the popular vote (5M votes) in the Bundestag elections on Sunday, and is now the third biggest political party in the country.