Freight Firms Warn of Brexit Disruption amid UK-EU Deadlock

Freight Firms Warn of Brexit Disruption amid UK-EU Deadlock
Traffic moves along the M6 motorway near Birmingham, England, on May 18, 2020. (Rui Vieira/AP Photo)
The Associated Press

LONDON—British freight haulers and storage companies are demanding an urgent meeting with government leaders because of concern that gaps in preparations for Brexit may threaten supplies of critical goods.

Trade associations representing the companies wrote to Michael Gove, the minister overseeing Britain’s exit from the European Union, saying that improvements to border posts and computer systems are behind schedule.

Most of Britain’s food comes from the EU, much of it on trucks through the Channel port of Dover, and the freight industry is warning there could be major logjams when customs checks and other procedures have to be imposed on Jan. 1.

The groups say that if the issues aren’t addressed, “UK business and the supply chain that we all rely so heavily on will be severely disrupted.”

Transport Secretary Grant Shapps said Friday he was confident goods would keep flowing. The British government is investing millions in new IT systems and border facilities and recruiting thousands of customs staff to deal with the new arrangements.

More than 40 years of seamless trade with the EU will end on Jan. 1 after an 11-month transition period that followed Britain’s formal departure from the bloc earlier this year.

The UK will leave the bloc’s single market and customs union, and it’s unclear whether there will be tariffs and other obstacles to trade. The two sides hope to strike a free-trade deal, but negotiations are deadlocked with just months to go.

The trade groups, including the UK Warehousing Association, Logistics UK and the Chartered Institute of Logistics and Transport, said the COVID-19 pandemic has demonstrated the importance of a supply chain that works properly.

“With transition occurring at the same time as a potential second COVID spike, it is critical we ensure the supply chain is protected,’’ they said.

EU and British negotiators are due to meet in London on Monday for a crucial week of talks—their eighth round in negotiations that have made little progress. The EU says a deal has to be struck before November to allow time for parliamentary approval and legal vetting before the transition period expires at year’s end.

But the talks are deadlocked over fishing rights and rules for state aid to businesses. The EU is insisting on a “level-playing field” for companies, so British firms can’t undercut the bloc’s environmental or workplace standards, or pump public money into UK industries.

Chief EU negotiator Michel Barnier said this week that he was “worried and disappointed” by the lack of progress.

“So far the UK has not, frankly speaking, engaged constructively,” Barnier told an event hosted by an Irish think tank. “The UK is still looking to keep the benefits of the EU and the single market without the obligations.”

Britain accuses the bloc of making demands that it has not imposed on other countries it has free trade deals with, such as Canada, and is also vexed by EU demands for long-term access to British fishing waters.

Supporters of Brexit say leaving the EU’s single market for goods and services will let Britain strike new trade deals around the world. Talks are underway with major countries including the U.S.—which have made slow progress—and Japan.

Most economists say new trade deals are unlikely to make up for the economic hit of erecting barriers with the EU, which accounts for almost half of Britain’s trade.

by Danica Kirka and Jill Lawless