UK Transport and Brexit News & Views No. 20

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Mark’s week 

German Chancellor Angela Merkel is not known for hyperbole, so when she warns in a speech to the German Bundestag that Britain should not hold any “illusions” about what Brexit means for its future, and also that it “cannot and will not have the same rights as a member of the EU” we should probably take serious notice.  These remarks followed the ‘private’ talks over dinner at Downing Street between Jean-Claude Juncker, Michel Barnier and Theresa May.  Private of course in the Brussels sense of the word, in that everything was leaked.  So what does this mean for transport? Well firstly, it’s pretty clear there will be no early deal on anything, including aviation and customs, until the fundamentals of money, citizens and Northern Ireland are sorted. Second, the negotiations will be subject to a running commentary (at least from the EU side). Third, the Germans and other Member States are prepared to take a short term economic hit in order to, as they see it, protect the long term interests of the EU.  Of course none of this is new and underlines my advice that organisations and companies should now be preparing for a hard Brexit, whilst doing their utmost to facilitate the right climate for deals once the grandstanding has subsided post the general elections in France, the UK and Germany.   Of more significance was the fact that the EU’s negotiating position was unanimously agreed in just 15 minutes by the EU 27 last week. This is not going to be easy. If you want to change that join UKTiE! Contact us here  and see our membership brochure here.

1. UKTiE meets with important EU officials
UKTiE members recently met with the Estonian Perm Rep where we discussed Brexit and regulatory issues. We are also planning another round of meetings with Karima Delli MEP (Chair of the European Parliament’s Transport Committee), Vicky Ford MEP (Chair of the European Parliament’s IMCO Committee) and Michel Barnier (The European Commission’s Chief Brexit Negotiator).  Ahead of these meetings we will prepare our position paper, including case studies from each of our members, to re-inforce our arguments as to the sort of Brexit deal UKTiE is pressing for.

2. Key Brexit negotiators meet Theresa May at 10 Downing Street
Last Tuesday Mr Juncker and Mr Barnier met Theresa May for private talks over dinner at Downing Street. Also present were Sabine Weyand, Martin Selmayr and David Davis. The Express reported that Juncker and Barnier seemed less happy when they left than when they arrived. Although Mrs May denies that the dinner went badly, the Frankfurter Allgemeine (FAZ) claims that Mr Juncker said “I leave… 10 times more skeptical than I was before.” The Economist reporter tweeted what the article claimed they talked about.

3. EU’s negotiating position unanimously agreed in just 15 minutes by the EU 27
The European Council agreed in a matter of minutes the guidelines that were put before them. There was nothing new – no sectoral approach – the four freedoms are indivisible – negotiations will be transparent (no matter what Theresa May would like). Furthermore, it was made clear that the money and citizens’ rights would be agreed upon in the first phase, before any other issues are tackled. This will create further uncertainty as it will take some time before there is any meaningful discussion about transport and customs.  While the politicians and civil servants are spinning all these plates, the transport industry should be making the most of this time to find their own solutions.

4. Europe’s car industry appeals for tariff-free trade deal ahead of Brexit summit
Just before the EU leaders’ Brexit summit on Saturday, the car industry demanded a guarantee of tariff-free trade after Brexit. They claim their industry is particularly vulnerable due to the way that European vehicles in Europe are built, with parts from factories all across the EU bloc. At a press conference, Erik Jonnaert, secretary-general of the European Automobile Manufacturers’ Association, said: “The key difference for our sector is that the core business model is the integral value chain”. This means that non-UK based car manufacturers also have a stake in ensuring a smooth Brexit.

5. British Port Association calls for transport connectivity post-Brexit
At their Annual Lunch, British Ports Association’s Chairman Rodney Lunn called for trade facilitation, port zones and transport connectivity to be prioritized in the Government’s post-Brexit strategy. “Post Brexit the BPA will be pushing for the EU Port Services Regulation to be repealed. It is unwanted and unnecessary and also let’s look properly at the customs free trade proposals for ports”. He said the Government must provide the right policy and regulatory framework in order for ports to meet their potential in driving regional and national economies.

6. Talks over the rights of citizens on both side of the Channel set to be “extraordinarily complex”
Many EU citizens in the UK and UK citizens in Europe are facing an uncertain future. Although both the UK and the EU have said that they wish to protect the rights of citizens to live, work or study in their current country, last week EU sources said those rights cannot be taken in isolation “opening up extraordinarily complex negotiations on other rules guaranteeing, for example, access to social security and health care and welfare payments”. The British government has not yet set out how its post-Brexit immigration system will work though many expect it to be an Australian-style points based system. Labour has promised to guarantee the rights of EU citizens if elected.

7. What would Macron winning the French elections mean for Brexit?
The Guardian believes that Macron will drive a hard bargain in Brexit negotiations. They quote him: “I am attached to a strict approach to Brexit: I respect the British vote but the worst thing would be a sort of weak EU vis-a-vis the British” The BBC suggests that Macron’s business-friendly policies may make France look more attractive to businesses considering leaving the UK. City A.M. suggests that a Macron win could be good for Brexit, as it will assuage the EU’s fears of a populist trend and consequently make them less likely to feel the need to “punish” the UK as an example for other Members also considering leaving the EU.

8. Business chiefs warn against Brexit dominating the election
Business chiefs, including the director-general of the British Chambers of Commerce, Adam Marshall, and Institute of Directors head of Europe and trade policy, Allie Renison, are warning against Brexit-dominated party pledges. The parties’ manifestos are expected to be published after the local elections on May 4. “Making the best of leaving the EU depends on strengthening our economic fundamentals, including infrastructure and skills. While the two are clearly linked, there needs to be far greater emphasis on detailing how parties intend to do the latter.”

9. Committee criticizes Government’s plans regarding air quality standards
The Environmental Audit Committee has responded to the Government’s report on The Airports Commission Report Follow-up: Carbon Emissions, Air Quality and Noise. They criticize the Government’s refusal to commit to maintaining air quality standards post-Brexit and call its estimate of the carbon impacts of Heathrow “a fantasy”.

10. UKTiE have also put together the latest timetable for Brexit. We will keep this up to date as the process develops: