EEF chief executive Stephen Phipson’s call comes following last week’s failure to agree a tariff schedule at the World Trade Organisation (WTO).
Phipson urged the Government to recognise the dangers to jobs and livelihoods that would follow the simultaneous loss of EU membership benefits while negotiations with the WTO were still in their infancy. International trade negotiations often took more than five years and we were only at the beginning of this process, he said.
The Government had failed to prepare adequately for the time and complexity required to reach agreement with the WTO. While talks continued, industry urgently needed clarity and stability. That meant a significantly longer transition period following our exit from the EU, said Phipson.
‘Government’s hope naïve’
Manufacturing employed 2.8m people in the UK and accounted for close to half of all exports, he added. “The Government’s hope that agreeing a tariff schedule with the WTO would be simple was naïve. At a time of rising protectionism and the return of barriers to trade it is no great surprise that other countries have refused to accept our ‘cut and paste’ short-cut.
“Many of our members have been planning on the back of repeated assurances that membership of the WTO and new trading deals with other countries would be struck quickly and easily.
“Now the Government must recognise that this strategy has failed and it must allow industry sufficient time to prepare for an uncertain global trading relationship. We must not give up all the benefits of the EU.”
However, Edwini Kessie, WTO director of agriculture and commodities, was more optimistic about the UK’s transition to WTO rules post-Brexit in a recent interview with Food Manufacture.
“If the UK were to become a WTO member in its own right, then definitely it would be able to rely on the key principles of the WTO, including the non-discrimination principle, which would ensure its exports are not discriminated against by other WTO members,” he said.
“Likewise, it would also be able to rely on the national treatment principle, which would ensure countries would not give favourable treatment to their domestic produce over imported products.”
The WTO rules would also provide the UK with a level playing field when it came to trade disputes between export partners, as well as protection from illegal subsidies to the food and beverage industry, said Kessie.
The prospect of a no-deal Brexit and the creation of trade tariffs with the EU, where there once were none, could limit trade volumes, he admitted. However, he was optimistic that adopting WTO rules could open up many more markets for the UK to export to and develop.
Supply chain consultancy Scala has suggested the UK faces five years of turmoil after Brexit.