Monday, July 29, 2019

As Britain Sails Toward a No Deal Brexit the Logistics Professionals Must Now Step Back and Watch

New PM Has Set a Course Which Only the EU (and Possibly Parliament) Can Change
Shipping News Feature
UK – Suddenly the stagnating mess which was Brexit is starting to become a cogent picture. The new government formed by incoming Prime Minister Boris Johnson is packed with entrenched leavers and, despite the very real wishes of the players in the logistics supply chain desperately wanting a settled exit, the spectre of a no deal scenario now looms large.

Truth be told unless the UK was prepared to walk away accepting the fate such a situation would bring then there was never ever any real hope of a negotiated settlement. One can only negotiate with cards in one’s hand, and the stance taken by Theresa May, never a true Brexiteer, gave the EU carte blanche to dictate the terms.

The shipping industry may not like a no deal but the reality is that such an outcome will harm the EU more than Britain financially, but the loss will be easier to bear for the group of nations, spread as it is across so many other countries. The reason for the EU’s intransigence is obvious, it is viewed by many as a failed organisation, the ingress of poorer countries has led to bad feeling internally as funds have been transferred from the richer economies to the poorer.

This Robin Hood behaviour is of course very laudable, and true to the original spirit of the idea of a united Europe yet, as with the weakness of the British politicians in recent years, so the EU leaders have allowed their policies to be abused by some countries, whilst the appearance of the Brussels and Strasbourg elite is, to many observers, simply an organisation of fat cats, doing little and raking in the profits of their positions.

Now, as if by magic, the new Treasury Secretary has declared the UK has seemingly unlimited funds to prepare for a no deal. None in the freight business will see the possibility of an untroubled transition, no matter how much money is thrown at it, as a satisfactory outcome. However the more rational will see the government position for what it truly is, summed up by Michael Gove, the new Chancellor of the Duchy of Lancaster and responsible for co-ordinating No Deal preparations, saying ‘let’s see who blinks first’.

Currently Boris Johnson, like his unpredictable opposite number across the Atlantic, looks unlikely to be the first to shy away. Certainly reality has started to dawn amongst those who represent the goods delivery sector, with James Hookham, CEO and head of Brexit readiness at the Freight Transport Association (FTA), saying:

“Logistics businesses need to take the prospect of a No Deal Brexit seriously and speed up any preparations which can be made. While there are still areas of uncertainty for those tasked with moving goods and services between the UK and Europe, most of the requirements that will kick in in the event of No Deal have now been published and are freely available.

“In the run up to the March 29 Brexit, FTA lobbied the UK and the EU to obtain important temporary easements and contingency measures which will assist the industry to keep our trading links open. However, many of these will expire, or are due to lapse shortly after the new 31 October Brexit deadline, and FTA is urging the new ministerial line ups to prioritise extending or re-establishing the necessary measures to ensure that trade can continue to flow freely to and from British industry.

“But while these discussions are ongoing with government, exporters, importers, freight forwarders and logistics operators in the UK and those working internationally should be taking steps to understand what they may have to do, how it should be done and who they need to deal with to keep their operations flowing.

“The UK’s supply chains are highly interconnected and complex and need to be protected if Britain is to keep trading efficiently with its biggest export markets in Europe. We would still much rather the UK leaves the EU with an Agreement that assures the continuity of frictionless trade but if this is not possible, then as an industry we will need to be ready for the challenging and complicated task of navigating the requirements that will apply.”

Meanwhile Road Haulage Association (RHA) chief executive, Richard Burnett has asked the new Transport Secretary, Grant Shapps MP, to work closely with the UK haulage industry making every effort to ensure that businesses are Brexit-ready. He said that firms are still in the dark over the new processes they’ll be expected to work with amid concerns that red tape and inadequate infrastructure will lead to chaos at ports, continuing:

“The economy relies on goods moving freely across our borders but up to now we’ve seen no evidence that the government has the systems or support for firms in place to maintain that flow. It’s now make or break for the many thousands of UK haulage operators, responsible for moving 98% of the economy.

“In addition to welcoming the new Transport Secretary I also want say how pleased I am that Stephen Barclay MP has retained his position as Secretary of State for Exiting the European Union. We have already established a good working relationship with him and his department and are delighted that with Brexit now only [less than 100] days away, continuity will be maintained.”

A relief then that the RHA at least can start afresh, Richard Burnett having famously fallen out with the former boss of the DfT, Chris Grayling, so publicly. Now of course comes the tricky part, Britain still facing uncertainty as to what comes next. One thing seems certain at the moment, Johnson intends the UK to leave the EU in October. To go back on that policy would lose him all credibility in the eyes of the voting public, he faces however a variety of political shenanigans from other parliamentary forces home and abroad who seem determined to at least add their own spin on the exit.

It should at least prove nothing, if not interesting.

Photo: Boris Johnson stands with Sir Robin Knox-Johnston at the start of the Clipper Round the World Yacht Race at St Katharine Docks in London 2013.