[ID] => 10121
[post_author] => 34
[post_date] => 2018-09-20 09:11:29
[post_date_gmt] => 2018-09-20 08:11:29
[post_content] => The UK’s exit from the EU, scheduled for March 2019, is causing great consternation in the local economy and nowhere more so than among logistics service providers. Uncertainty about the form of any future customs and tax arrangements between the UK and the EU makes it difficult for those involved in trade, whether as exporters, importers or logistics firms, to plan very far ahead.
Much of that uncertainty derives from the UK Prime Minister’s inability to reconcile the two wings of her ruling Conservative Party; without being able to come down on one side or another, Prime Minister ‘Maybe’ has been unable to define exactly what the UK expects from a post-Brexit arrangement and, as a result, no arrangement has been forthcoming.
It should not be forgotten in all this that Brexit – and particularly a ‘no deal’ Brexit – will have serious repercussions for similar industry sectors on the other side of the (English) Channel. This is especially true of companies operating in and through the major northern European ports – as well as the ports themselves. For instance, some 90 per cent of ro-ro traffic leaving Rotterdam is bound for the UK.
NOT LONG TO GO
The tide of populism that delivered the Brexit vote in 2016 has also had an impact in other EU member states, which has created uncertainty in a number of countries about whether other EU exits might be possible, or about how the continuing EU will respond. Meanwhile, those involved in cross-Channel trade seem to be taking a ‘wait and see’ approach to the more immediate threat. In the summer, a conference at the European Parliament concluded that there is a lack of urgency about the issue, and a recent survey in the Netherlands found that only 18 per cent of companies likely to be affected by Brexit are planning for a worst-case scenario, which would involve no deals on customs and tax arrangements.
The Port of Rotterdam is, though, taking the threat seriously; Allard Castelein, CEO of the Port of Rotterdam Authority, has initiated a dry run for a no-deal Brexit, involving public and private interests, to be held in late November, 90 days before Brexit becomes reality. Rotterdam is particularly at risk, since some 40m tonnes of freight moves between Europe’s largest port and the UK each year, with around 600,000 trailer movements.
At present, the frictionless border between the UK and continental EU states means that goods leaving Rotterdam on an afternoon ferry can be in UK shops the next morning. After 29 March 2019, that will no longer be the case. In September 2018, representatives of the Port of Rotterdam Authority, Dutch Customs and the Dutch Consumer Safety Authority (NVWA) made it clear that, under World Trade Organisation (WTO) rules, which will apply post-Brexit, customs formalities and the supervision of goods moving between the Netherlands and the UK will be re-introduced. That will include the levy of customs duties, goods and vehicle inspections, and the collection of documentation, leading to inevitable delays at border points on both sides of the Channel.
UK negotiators have been told that they cannot rely on ‘special arrangements’ being in place to tackle the loss of free trade, and the attendant customs, food and veterinary inspections and the documentation to go with them; there have been suggestions that this will quickly generate five-mile queues for freight traffic within the port area in Rotterdam.
As yet, plans for the construction of new customs inspection posts, parking spaces for lorries and cool warehouses for flowers and vegetables have been put on hold while the world waits for the outcome of negotiations. The UK authorities have so far made preparations for the worst by planning to install portable toilets along the M2 and M20 motorways, as it is anticipated that drivers will be held up for hours, if not days, waiting for embarkation onto ferries from Dover or onto the Shuttle trains through Eurotunnel.
One problem to be faced is that most people working for companies that are involved only in intra-EU trade have no experience of the legal requirements for international trade. It is estimated that there are around 35,000 companies just in the Netherlands that are in this position and will have to learn about customs declarations and other compulsory documentation if they are to continue to trade with the UK.
The same goes for the authorities: the Dutch government has taken the precaution of preparing to hire (and train) 928 additional customs officers; the Consumer Safety Authority will hire 143 staff, including around 100 vets, to monitor the Dutch border.
Trade associations in the Netherlands are also preparing for the worst. The employers’ association VNO-NCW has warned its members to be prepared and is offering assistance. Together with the government, other branch organisations and banks, VNO-NCW has set up a website with details and instructions on how to deal with the impact of Brexit on their business with the UK.
The cost to the Netherlands of Brexit – in terms of added costs and inefficiencies as well as lost trade and higher consumer prices for UK goods – has been estimated at more than €10bn over the coming ten years. One can only imagine that other EU countries will face similar financial losses. Given the size of the impact on EU states, and the fact that the UK has not been able to establish quite what it wants its relationship with the EU to be post-Brexit, EU trade negotiators are currently focusing on striking new deals with other countries, notably Norway, Canada and South Korea.
The EU’s chief negotiator, Michel Barnier, has repeatedly stressed that the UK cannot pick and choose from a menu of agreements and, while he said last month that “we still hope to reach an agreement with the UK”, he was also firm in his insistence that there will be no ‘business as usual’ after Brexit.
[post_title] => Trade: Business as unusual
[post_status] => publish
[comment_status] => open
[ping_status] => open
[post_name] => trade-business-unusual
[post_modified] => 2018-09-19 09:15:29
[post_modified_gmt] => 2018-09-19 08:15:29
[post_parent] => 0
[guid] => https://www.hcblive.com/?p=10121
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Trade: Business as unusual
Ripples from the Brexit decision are spreading throughout Europe; Rotterdam is likely to be particularly badly affected, as Janny Kok reports