Brexit could make U.K. car sec­tor ex­tinct: Busi­ness lobby

The Daily Star (Lebanon) - - BUSINESS -

LON­DON: The pres­i­dent of Bri­tain’s main busi­ness lobby warned Wed­nes­day that the coun­try’s car in­dus­try risked “be­com­ing ex­tinct” out­side the EU’s cus­toms union.

“If we do not have a cus­toms union, there are sec­tors of man­u­fac­tur­ing so­ci­ety in the U.K. which risk be­com­ing ex­tinct,” the Con­fed­er­a­tion of Bri­tish In­dus­try’s Pres­i­dent Paul Dreschler told BBC Ra­dio 4’s To­day pro­gram.

He high­lighted the car in­dus­try as be­ing par­tic­u­larly threat­ened by any deal that did not se­cure “real fric­tion­less trade” with the Euro­pean Union post-Brexit.

Prime Min­is­ter Theresa May is un­der pres­sure to com­mit to some kind of cus­toms part­ner­ship as she pushes key Brexit leg­is­la­tion through Par­lia­ment, de­spite promis­ing that the United King­dom would make a clean break with the EU in or­der to strike trade deals with the rest of the world.

The CBI pres­i­dent claimed there was “zero ev­i­dence” that such deals would pro­vide any eco­nomic ben­e­fit to Bri­tain.

“There’s zero ev­i­dence that in­de­pen­dent trade deals will pro­vide any eco­nomic ben­e­fit to the UK that’s ma­te­rial. It’s a myth,” he said.

The un­cer­tainty was also forc­ing com­pa­nies to de­lay in­vest­ment de­ci­sions, he added.

“We al­ready know tens of mil­lions, in fact hun­dreds of mil­lions have been in­vested by U.K. phar­ma­ceu­ti­cal and fi­nance com­pa­nies to cre­ate con­ti­nu­ity post a worse-case Brexit sce­nario,” he said.

“We still haven’t got clar­ity about the fu­ture di­rec­tion, about where we’re head­ing, what will the fu­ture re­la­tion­ship with Europe be, at a level of de­tail that mat­ters for in­vest­ment,” Dreschler added.

Brexit cam­paigner Pa­trick Min­ford, from the Economists for Free Trade group, ac­cused the CBI of do­ing the bid­ding of “vested in­ter­ests that op­pose the com­pe­ti­tion and pro­duc­tiv­ity growth that free trade un­der Brexit will bring.”

“Pre­cisely what Brexit will do is re­move the EU pro­tec­tion­ism and ex­ces­sive reg­u­la­tion that is hold­ing back our econ­omy,” Min­ford told the BBC.

“The gains from our po­ten­tial free trade agree­ments are well doc­u­mented. Our cal­cu­la­tions put them at 4 per­cent of GDP,” he added.

May Tues­day avoided a ma­jor blow to her Brexit strat­egy af­ter law­mak­ers re­jected a plan that would have given Par­lia­ment a veto on the fi­nal deal ne­go­ti­ated with Brussels – but only af­ter reach­ing a back­room deal with po­ten­tial rebels.

She faces fur­ther bat­tles Wed­nes­day over how closely Bri­tain stays aligned with the EU’s econ­omy af­ter leav­ing. –

The car in­dus­try is one of sev­eral man­u­fac­tur­ing sec­tors that are threat­ened by leav­ing the EU cus­toms union.

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