The government has been urged to set out details of the possible post-Brexit trade options between the UK and the EU in order to provide the most information possible about how the system will operate beyond 2019.
A report by the Institute for Government released today argues that the government plan released this week calling for the UK to agree a transitional customs union with the EU from the date of Britain's exit in March 2019 would only be “half the story”.
Such an arrangement would not be enough to ensure that supply chains in sectors such as car manufacturing are maintained at current levels.
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According to the think tank, there are five possible options for a future trade deal, which range from a comprehensive free trade deal, including customs cooperation, to leaving the bloc to trade on WTO terms. Other options also include a new customs union agreement outside the EU’s single market, or staying as members of the free trade zone either with the EU’s customs union or with new customs terms.
Jill Rutter, the IfG’s Brexit programme director, said these are all likely to increase disruption to trade from the current system, and called for the government to set out in much greater detail the range of options as “simply addressing customs issues is not enough".
She added: “Until we see plans for the future relationship with the single market, particularly for agriculture and fisheries, we will not know the scale of likely border checks and additional compliance costs.
“Government needs to show it has a clear understanding of the implications for business of its negotiating strategy. We are calling on it to publish proper assessments of the impacts of the options to allow for informed public debate.”
Report co-author Alex Stojanovic added there was “no perfect solution to future trade”.
“Disorderly disruption to UK supply chains will pose risks to the sectors concerned,” he said. “So, as it negotiates our new relationship with the EU, the government needs to understand the full implications of new potential impediments to trade."