UK and EU chemical bodies demand sector guarantees against no-deal withdrawal
14 Nov 2017
British and Europe-wide chemical industry associations have issued a joint statement calling on the UK government to provide post-Brexit safeguards that will guarantee the sector’s continued prosperity.
The statement by the Chemical Industries Association and Cefic demands conditions are met that would minimise disruption and avoid the risk of the UK withdrawing from the European Union without a new trade agreement in place.
Cefic director general Marco Mensink (pictured) and CIA chief executive Steve Elliott both called for:
A transitional period between Brexit and the new deal
Customs procedures that would limit costs and delays while easing the flow of goods
Permit free movement of skilled labour between Britain and the 27 other member states
Steps to encourage investment in the European chemicals industry
The maintenance of regulatory consistency in any new deals
They stated: “Following Brexit, UK sales in the EU27 will need to comply with all relevant product safety regulation including REACH, biocides and pesticides legislation.
“Duplication of regulation and its associated cost should be avoided through securing regulatory consistency and continued collaboration with the relevant EU agencies such as ECHA (the European Chemicals Agency).”
Failure to secure a transitional period and a new trade agreement means the UK reverting to WTO Most Favoured Nation status.
Duplication of regulation and its associated cost should be avoided through securing regulatory consistency and continued collaboration
Cefic-CIA joint statement
This would result in the reintroduction of import duties on chemicals trade between the EU27 and the UK. If the UK assumed the same WTO commitments as the EU, this would mean a maximum tariff level of 5.5% or 6.5% on chemicals trade, or €40 billion annually.
The UK chemicals industry is heavily dependent upon trade with the European Union, which itself benefits substantially.
Last year the UK imported €22.6 billion from the other 27 EU states – equal to some 4.5% of all EU chemicals sales. An estimated €19.3 billion worth of chemicals are exported from the UK to the EU27. Overall the UK chemicals industry accounts for 7% of total EU sales from all 28 member states.
“The chemical industry and its suppliers and customers are part of highly integrated European and global industry value chains, with complex supply chains often crossing borders on many occasions both inside the EU and across the external EU border,” said the Cefic and CIA chiefs.
“Chemicals may cross the EU27 and UK borders several times, either in the form of final chemical products or integrated in (intermediate) products made with chemicals (e.g. car parts). Even in the case of the most advanced trade agreement, customs procedures will be much more complex and costly than in the single market of today.”