Yahoo Finance Brexit: Ukraine war puts new urgency around better UK-EU trade relations
The escalating conflict in Ukraine has "highlighted" the importance of Britain and the European Union working closely together to improve trade relations, a report says.
A new analysis from MPs and business leaders has set out a plan for the UK and EU to remove points of division as they face increased threat from Russia and external economic and security challenges.
In their annual study published on Friday, the cross-party and cross-sector UK Trade and Business Commission (UKTBC), suggests 21 actions aimed at improving cooperation and trade between the pair.
This will help industries that bear the brunt of costly red tape and barriers to trade, which are artificially increasing costs for them and consumers at a time when global events threaten to hike costs even further, UKTBC said.
The proposals also aim to remove points of political tension including around the Northern Ireland Protocol.
"The invasion of Ukraine has highlighted just how important it is for the UK and the EU to work together to tackle the huge external challenges we both face," said Hilary Benn MP, co-convener of UKTBC. "So let’s find a resolution to the problems – like the Northern Ireland protocol – which have caused division between us."
The recommendations include new support for small medium sized firms (SMEs), a UK/EU veterinary agreement and more scrutiny of trade deals.
It also seeks to find a successor to the Brexit Support Fund with a simpler application process and more substantial grants after the original fund paid out just £6.8m of the £20m set aside to support firms.
Read more: UK businesses facing rising costs, paperwork and delays over new import rules
There have been changes in the way the UK trades with the European Union (EU) and in relation to the movement of goods between Great Britain and Northern Ireland since the end of the agreement transition period on 31 December 2020.
As a result the EU introduced full import controls. The UK government originally intended to do the same but has delayed three times over the last year.
Alison WIlliams, global head of data at DunnHumby and member of the UKTBC, said: "The government’s Brexit deal has touched all parts of our economy and has unfortunately been failing a large number of British businesses, costing investment, income and jobs in the UK.
"With more checks on the way and huge economic challenges facing us, it is imperative that the government acts on these recommendations now so we can work with our European partners to weather the storm."
Other recommendations include:
More flexible visa rules for seasonal workers, service industries and the creative sector
More defined process and increased scrutiny of new trade deals including new bodies to assess the impact they will have on UK standards and net zero goals
As the cost of living crisis deepens across both sides of the Channel, the government’s "Brexit deal has so far delivered added costs for business, less choice for consumers, increased delays, and now, in the midst of another global crisis, red tape is even hampering our ability to deliver humanitarian aid," said Naomi Smith, CEO of Best for Britain and secretariat to the commission.
Read more: Migration data shows Johnson's Brexit will not result in high wage economy
A separate report shows Brexit has had a "clear impact" on Britain's trade volumes and new border arrangements have added "costs" to UK business.
According to a Public Accounts Committee (PAC) report, there could be "potential disruption" at the border if cross-border passenger volumes – which have been at a fraction of normal levels due to COVID-19 – recover as expected in 2022.
This could be exacerbated by "further checks at ports as part of the EU’s new entry and exit system" and especially at ports like Dover where EU officials carry out border checks on the UK side, it warned.
"One of the great promises of Brexit was freeing British businesses to give them the headroom to maximise their productivity and contribution to the economy – even more desperately needed now on the long road to recovery from the pandemic," said Dame Meg Miller MP, chair of the PAC.
"Yet the only detectable impact so far is increased costs, paperwork and border delays"
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