‘UK must stay in customs union with EU’

Bloomberg

The UK should ensure it stays in a close and comprehensive customs agreement with the European Union, providing tariff-free trade in all goods after Brexit, according to the leader of a major business group.
Remaining in a customs union with the EU will be far more valuable than striking trade deals elsewhere, Carolyn Fairbairn, director general of the Confederation of British Industry (CBI), will say on Monday, based on excerpts from her prepared remarks.
“The idea behind a customs union is simple: a single set of tariffs for goods imported from outside the EU, enabling tariff free trade within it,” Fairbairn will say. “It brings no obligations over freedom of movement, or payment and removes some of the heaviest trade barriers.”
Prime Minister Theresa May aims to take Britain out of the EU’s 28-country customs union to gain the freedom to sign new trade agreements with other nations such as the US, Australia and New Zealand. Brexit-supporters in her Tory party say winning back the power to make Britain a “global trading nation” is a key prize of escaping the EU’s rules.
But Fairbairn and other business leaders such as Mike Thompson, who represents the country’s pharmaceutical industry, disagree. “Any change to existing customs arrangements could create border chaos, cause damaging delays and ultimately put patients and public health at risk,” Thompson, chief executive of the Association of the British Pharmaceutical Industry, said by in emailed remarks on Sunday.

New Spirit
May’s ministers and officials are working to hash out what they want the final Brexit trade deal to look like. French President Emmanuel Macron said the country will likely end up with something “between full access and a trade agreement.” The UK and EU aim to negotiate a transitional phase by the end of March, before moving on to map the future trading terms by October.
The CBI, which represents 190,000 UK businesses employing seven million people, wants Brexit negotiators to step up the pace of talks. “Time is running out—by March next year our country will be out of the EU,” Fairbairn will say. “We need to end this game of who-blinks-first and instead find a new spirit of urgency.”
Speaking at the University of Warwick, near the city of Coventry in central England, Fairbairn will call for a trade accord with the EU that is better than Canada’s, which excludes financial services. Customs union membership would also resolve the question of how to keep an open border between Ireland and the UK, she will say. Richard Tice, co-chair of the Brexit campaign Leave Means Leave, said staying in the customs union would “handcuff” British businesses.

Macron hopes for UK’s post-Brexit EU market access
Bloomberg

French President Emmanuel Macron may have raised hopes for Britain’s post-Brexit relations with the European Union, saying the UK will likely end up with something “between full access and a trade agreement.”
“To get full access you need to contribute to the budget and agree to the four freedoms and to the jurisdiction,” Macron said in excerpts of an interview with the BBC. “As soon as you decide not to join these preconditions, it’s not a full access, so it’s something perhaps between full access and a trade agreement.”
Macron said access for financial-service companies also required accepting the obligations, but said he didn’t want to “unplug” London’s financial sector from the EU. “It doesn’t make sense, because it’s part of the whole financing of our European Union,” according to comments posted on the BBC website.
Macron met British PM Theresa May at the Sandhurst military academy near London to discuss bilateral issues unrelated to the UK exit from the EU such as military, security and cultural cooperation. But Macron used a press conference to insist that continued full access to the EU’s single market required accepting the bloc’s rules.
“What’s important is not to make people believe it’s possible,” Macron said on the BBC, before the interviewer interrupted and said “to have your cake and eat it too?” Macron nodded and said “yes.”
EU chief Brexit negotiator Michel Barnier has insisted the UK can hope only for a free-trade pact similar to the one the EU has with Canada, rather than an arrangement that maintains stronger ties. Brexit Secretary David Davis has said he wants a trade deal that would include the best parts of the bloc’s agreements with Japan, Canada and South Korea, along with financial services, which are not included in those trade deals.