CBI warns EU business must unite for a good Brexit deal
“It is essential we all work together, the final Brexit deal will have real implications not just for British business but for firms in Malta and across the EU”, the Confederation of British Industry’s President Paul Dreschler told an MCCEI seminar on Monday.
The 200 business leaders attending the event entitled "What Brexit means for Business" were also addressed by the Prime Minister, Dr Joseph Muscat and by Dr Stefano Mallia, Vice-President of the Employers’ Group of the European Economic and Social Committee.
CBI is repeating a three-point message across the continent, according to Mr Dreschler. “First, companies need access to people and skills from across the continent. We called on our government to make an immediate, unequivocal commitment. Prime Minister Theresa May wants to guarantee the rights of EU citizens living in Britain and British nationals in other member states as soon as possible. We still believe that a unilateral commitment to people from the EU working in our country is the right thing to do.“
“Second, firms need access to EU markets. By ruling out membership of the Single Market the Prime Minister has reduced her options for maintaining a barrier-free trading relationship between the UK and the EU. But an ambitious and comprehensive free trade deal between the UK and the EU can still deliver a result that’s in both our interests.”
“Of course the UK could always end up without a deal and trade through World Trade Organisation rules. European firms based in the UK have told me how bad this would be. With the UK being Malta’s fifth biggest export destination WTO rules would be bad for firms in this room and all across Europe.”
“Third, whatever the final deal, firms in the EU and the UK need a ‘smooth Brexit’ which gives time to prepare for any new arrangements. Here we’re pleased to see our voice has been heard. The phased implementation period promised by the UK government should give firms the time they need.”
“There’s a unique window of opportunity to shape the post-Brexit world,” Mr Dreschler concluded. “We all need to defend the openness which has underpinned our relationship for centuries, not take this for granted. Let’s speak up together about why access to people, to markets - matters. Let’s shout that message at events like today’s, whenever and wherever we can.”
Prime Minister Muscat warned that “we are in a new geopolitical context and have to understand the bigger picture, the changes – some sudden and unexpected – we are facing. Britain’s special relationship with US can either be a trump card or bring about the downfall of the whole system as we know it.”
“I have discussed Brexit with each EU leader, there is no sense of wanting to punish UK, but of the need to get to a political solution. In 2018 after national elections the bigger governments in the EU will be at the start of their term – a crucial part of the process. Not only British public opinion but the other 27 public opinions need to have their thoughts taken into consideration. Brexit reminds us that our citizens are always sovereign and should not be ignored. The European Parliament is being seriously underestimated, I can see it scuttling the deal at the 11th hour.”
“The government started preparing for Brexit with simulations ahead of the referendum to help us prepare for the impact and opportunities. We should wait some more weeks or months to see where the negotiations are going before making a detailed impact assessment. Business in Malta will have opportunities only if we act in a correct and constructive manner, want to be part of the solution and keep our current levels of growth and stabili- ty. We already have contact with companies wanting to keep a foot in Europe – I expect to announce soon an important relocation investment from outside Europe. The only drawback we have is carrying capacity – we lack necessary human resources, private school places for foreign workers’ children. We are working on establishing a new international school and educational improvements”.
“There is a sense of sadness, of acceptance in Brussels but also of frustration due to the uncertainty being created, “Dr Mallia indicated. “Following Theresa May’s speech on 17 January Commission President Juncker stated that “we want a fair deal for Britain, but a fair deal means a fair deal for the European Union... negotiations will be ‘ very very very difficult’”. The European Parliament’s Brexit negotiator Guy Verhofstadt MEP (former prime minister of Belgium) said that PM May was dreaming if she thought she would get everything she was asking for………. zero tariff access to the single market could not come without obligations. What has certainly not gone down too well was the rather unsubtle threat to turn the UK into some tax haven right on the doorstep of Europe if the EU does not give the UK a fair deal.”
Once the UK had activated the Treaty of the European Union’s article 50 governing withdrawal the Commission negotiator Michel Barnier would lead negotiations under a specific Council mandate drawn up by the 27 heads of state and government. Realising that the EU’s four freedoms were inseparable, the UK had now accepted that it would leave the Single Market but wanted access to specific sectors and paid participation in a few EU programmes.
“At the end of the negotiation process”, Dr Mallia continued, “the Commission will present a ‘withdrawal agreement’ and probably a second agreement on post-Brexit EU-UK relations, each needing majority votes from both the Council and the European Parliament. There was and still is (to some degree) a good amount of goodwill towards the UK but it is equally clear that this cannot come at the expense of the European Union project - which originally built for a small number of states, we need to review. If Brexit doesn’t act as a wake up call nothing will.”
“The Chamber should maybe look into undertaking a Brexit impact assessment which I am sure would be well appreciated by the business community and government alike.”