Since the UK government is bullish about surviving no trade deal with the EU shall we just look at how that might affect a few industries?
Cars: Over half a million UK made cars were exported to the EU in 2019. No trade deal = 10% tariff. Over £15bn exports could be lost.
Cars: Over half a million UK made cars were exported to the EU in 2019. No trade deal = 10% tariff. Over £15bn exports could be lost.
But actually it could be worse than that. Without being able to build to scale to sell to the EU market we could lose more of the UK's current £31bn automotive exports, which employ 168,000 people.
Food and drink. All manner of EU tariffs here, like 30% for confectionary. Though some products tariff free. Anyway £14bn of exports to the EU at stake here.
Chemicals. 6% tariff average or thereabouts, several £ billion exported to the EU (disaggregating this figure turns out to be quite tricky).
Now this is all just focusing on the tariffs as in many cases an FTA will do little for non-tariff barriers unless we choose alignment with European regulations, which we've ruled out. So add the tariff costs to the extra costs of regulatory compliance.
And then remember that we're supposed to be having an economic rebalancing away from London and the south east. Not starting well with a no trade deal Brexit threatening various export industries (impact studies will assume a shift to services away from manufacturing).
So when the government is saying their analysis is saying no trade deal is no problem they're also in effect saying no UK mass car industry is no problem. That moving chemical or food and drink production out of the country is no problem. Big call. /end
