- British Retail Consortium warns that “availability of affordable, quality products” could be disrupted by Brexit. Food and clothing imports could be disrupted even if government secures transition customers deal with the EU after March 2019. BRC wants the “agreements on security, transit, haulage, drivers, VAT and other checks” to avoid a crisis.
- REUTERS/Phelan Ebenhack
LONDON – Britain’s leading retail lobby group is warning that the UK is risking shortages on shelves unless the government does more to prepare for post-Brexit trade with the EU.
Imports of food, wine, clothing, and more could be disrupted by Britain’s expected exit from the EU customs union after March 2019, the British Retail Consortium said on Wednesday.
The BRC, which represents 70% of the UK’s retailers by turnover, published its “Customs Roadmap” report, calling for “wider recognition of the complexity and scale of the challenge pertaining to future customs controls.”
Helen Dickinson, chief executive of the BRC, said: “Whilst the Government has acknowledged the need to avoid a cliff-edge after Brexit day, a customs union in itself won’t solve the problem of delays at ports.
“So to ensure supply chains are not disrupted and goods continue to reach the shelves, agreements on security, transit, haulage, drivers, VAT and other checks will be required to get systems ready for March 2019.”
The Customs Union explained
Britain is currently a member of the EU’s single market and customs union, meaning there is tariff-free trade between the UK and EU members.
The government has stated that it wants to negotiate a transitional customs union deal for when Britain officially leaves the European Union in March 2019, before negotiating a “new” customs relationship with the EU which it hopes will be as “frictionless” as possible and include most of the benefits Britain enjoys as a customs union member.
However, the European Commission has said “frictionless trade is not possible” outside the customs union and EU Parliament chief Brexit negotiator Guy Verhofstadt says British plans are “fantasy.” Trade experts are also skeptical of the viability of Britain’s plans.
Whatever happens, a continuation of Britain’s current trading relationship with the EU seems unlikely.
What’s at stake
The BRC estimates that leaving the EU customers union will lead to an increase in customs declarations from 55 million to 255 million a year, with imports from the EU that previously passed through unchecked having to be registered and inspected.
If the UK does not invest in the infrastructure to support this dramatic increase, there could be delays of up to three days at ports, the BRC said.
Delays could lead to shortages on shelves and higher prices for perishable goods like food. The BRC estimates the cost of holding a delayed driver with a refrigerated lorry at a port at £500 per day.
Food and drink will be the hardest hit by any delays, with 79% of all food and drink imported into the UK coming from the EU. 12% of all non-food imports come from the EU, but that still equates to £1.4 billion worth of clothing imported from Turkey in 2015, for example.
Dickinson said: “We want to work with the Government to develop a system which works for consumers, so that there’s no difference in terms of the availability of affordable, quality products when they make purchases or visit stores post-Brexit.”
Dickinson’s warning echoes that of former Sainsbury’s CEO Justin King, who said in July that Brexit would lead to “higher prices, less choice, and poorer quality” at supermarkets.