Comment What of the Brummie Brexit?
economy and whatever Brexit looks like come March 2019 (assuming we still have Brexit), the priority for the region needs to be getting this right.
Beyond the golden age of manufacturing, the region’s economy has remained centred on the industry which accounts for one-sixth of its economy.
Research by the West Midlands Economic Forum suggests that, in real terms, that figure for “production” could be over a quarter.
Honda has already pointed out to MPs its reliance on importing from Europe.
It imports more than two million components from the continent each day and it has warned that, without proper customs administration, it could lose £850,000 each year due to 15-minute truck delays at checkpoints. This is before we even start talking about World Trade Organisation tariffs on the sector – which normally come in around ten per cent.
The automotive sector is about to change rapidly. We’re seeing huge investment into the driverless cars that just a few years ago belonged in I, Robot and there is clearly an opportunity for the region to expand in this area – if we get post-Brexit deals right.
Mayor Andy Street seems to agree. Just last week he said we had “the potential to lead the world in this future industry”.
But, to make the most of this, we need deals that will not just allow our rate of production to continue but to increase at a pace which allows us to lead in these new technologies.
As Jaguar Land Rover’s plans to manufacture its cutting-edge electric SUV in Austria and reports of expanding its Slovakian operations show, the industry has reached a tip- ping point. Clearly the next few months of negotiations will be vital in easing business uncertainty and ensuring the industry survives and prospers here.
We need to be pressing to make sure the post-Brexit world allows our businesses to continue to import with minimum disruption, be it with the EU or any other trade partners.
As far as our supply chains are concerned, if we are no longer part of the EU Customs Union, the government needs to act quickly and ensure that procedures are as streamlined as possible.
This will require close co-operation with our European partners (having noted that the UK government has a poor track record in delivery of complex IT projects).
This would also need to be accompanied by improved transport infrastructure across the region.
Moreover, there is no reason for the Government not to continue its valuable work supporting the UK’s automotive supply chain through initiatives such as the Advanced Propulsion Centre, in Coventry, and the Catapult Programme.
At the Centre for Brexit Studies, we will continue to research what the region needs from Brexit through analysis, interviews and public events like our forthcoming City Talk as the process continues, and make the case for an outcome that meets our requirements. The stats certainly show the strength of our economy is instrumental to the rest of the UK.
Birmingham is notable as being a city which was almost entirely split down the middle by the Referendum.
Eighteen months after a campaign which divided families and friends, the city – and the region – needs to join together and make the case for a Brexit which works for us.
Professor Alex de Ruyter is director of Birmingham City University’s Centre for Brexit
Studies
We’re seeing huge investment into the driverless cars and there is clearly an opportunity for the region to expand in this area