When discussing trade deals, we should beware any politician who talks of possible Tariff or Quota barriers, but ignores the third category, namely Non-Tariff Barriers. These are by far the most destructive barrier– tariffs and quotas are transparent, published in advance, and apply to all, and strategies can be pursued to mitigate them.
However, Non-Tariff barriers are largely invisible, and will be applied against us randomly, tactically and strategically – they were applied in each of these ways before the Single Market was created, and the European Court of Justice was given the role of stamping on such practices.
Large Corporate exporters can - and will - avoid these barriers via the single step of placing their investment within the Single Market, which is the natural way now of addressing major target markets, whether in Europe, USA or Asia. However, this option is typically not available to SME’s or smaller corporates, and they have to endure repeating misery as their consignments of goods are rejected or delayed at e.g. French customs posts, and the costs – extra storage, insurance, re-shipping and lost orders - hit their business.
Probably, there are few people now within the business representative groups, the Forum of Private Business, the Federation of Small Businesses, or the CBI who have direct experience of these barriers within the European Market, and fully appreciate how damaging they are.
These Non-Tariff Barriers have been enshrined in each published version of the proposed EU Deal, and will be punishing for these UK businesses.
What is critical, is to obtain detailed and early data – preferably generated by a high quality independent academic institution, to be made available to the business groups mentioned above, and to Government, starting on the 1st January, so that the scale and nature of any such damage can be addressed.
Kevin Jennings is a member of CGE. He was a Managing Director, NatWest Corporate Banking, with experience of both SME and Large Corporate sector export support over many years – both pre and post the creation of the Single Market.