‘No deal’ would hurt EU – and Irish – exporters the most
Throughout the Brexit negotiations, the EU has treated a trade deal with Britain as if it were a concession, offered to us out of the kindness of the European Commission’s heart. Pay us a fat leaving bill, comes the message, keep aligned with EU regulation, agree to be stuck in the Irish backstop until we feel like releasing you, and we will most generously allow you to trade with us.
Thanks to their inflexibility and intransigence – which resulted in Theresa May’s one-sided deal, almost certain to be defeated in the Commons on Tuesday – we are facing the prospect of a no-deal Brexit in just 11 weeks’ time. Sure, that will cause problems for UK consumers and industry – if not quite the apocalypse some have suggested. But no less, it will cause pain for many EU exporters who rely on the UK as a market, as EU exports to Britain are concentrated in areas where, in the event of a nodeal Brexit, tariff barriers are likely to be highest.
Under World Trade Organisation rules, Britain will be able to charge what tariffs it likes, with a few conditions. Product by product, it must charge the same tariff on every country – except where it has a formal trade deal.
In the short run, the UK would most probably start to apply the same tariff rates to the EU that we had applied to third countries as members of the EU. The EU would, after all, now be applying those on UK exports. But EU exporters would get the worst of this arrangement, because a higher proportion of their exports to us are in the field of agriculture, where tariffs are especially high.
No group of people in the EU or Britain stand to suffer so much from a nodeal Brexit as Irish farmers. Why has the Taoiseach, Leo Varadkar, made such an issue of the backstop when surely he must see that he is gambling with his country’s agricultural interests? According to an analysis by his own government, 11 of the 15 export products across the EU that would be most affected by tariffs under no deal are Irish.
A huge 82 per cent of Ireland’s £54 million a year milk exports, for example, go to the UK – and would attract tariffs of 45 per cent. The country exports £1.2 billion worth of beef a year, 49 per cent of which goes to the UK.
As for France, 13 per cent of its £7.6 billion a year wine exports go to Britain. With champagne, it is nearer a quarter. Much has been made of Jaguar Land Rover cutting 5,000 jobs in Britain, but the German car industry is suffering a worse downturn – which won’t be helped if it has to pay a 10 per cent tariff on the 14 per cent of its £120 million a year car exports that go to the UK. Forty-eight per cent of Italy’s olives go to Britain, as do 14 per cent of Spain’s £455 million fresh vegetables.
As things stand, the EU is still refusing to accommodate any changes to the deal negotiated by Mrs May. Are Michel Barnier and Co really going to stick to that line, knowing what is at stake for EU exporters, especially in Ireland, the country for whose benefit the backstop is supposedly designed? If I were an Irish dairy farmer I know what I would be telling them: never mind the faint risk of the minor inconvenience of a customs check at the border with Northern Ireland – just don’t cut off my livelihood. FOLLOW Ross Clark on Twitter @RossjournoClark;
at telegraph.co.uk/opinion To order prints or signed copies of any Telegraph cartoon, go to telegraph.co.uk/prints-cartoons or call 0191 603 0178 reader[email protected]graph.co.uk