brexit means brexit and we are going to
make a success of it it was happening
202 the nose to the left
432 then it was up in the air now with a
conservative majority and withdrawal
agreement finally passed in Parliament
sprigs it is steaming ahead to come out
of the EU customs union but with two
full starts but brexit Day last year an
endless political turmoil it's perhaps
little wonder that many companies are
still unsure of what to prepare for
ever since the referendum businesses
have been begging for certainty about
how breaks it will affect how they
operates well how's this for
clarification in today's financial times
the Chancellor has said by the end of
the year will no longer be in the
customs union nor the single market
Sajid Javid told business leaders to end
their campaigns to stay aligned with
bristles telling them they've had three
years to prepare for this uncompromising
in his message the Chancellor went on to
say they will not be alignment we will
not be a rule taker but he conceded
there will be an impact on business one
way or the other
some will benefit some won't the British
car industry alongside aerospace
pharmaceuticals and food relies on a
fast-moving supply chain across the EU
they have been pressuring the government
to maintain no tariffs or time-consuming
paperwork at the border something that
Boris Johnson seemed to recognize while
on the election trail just last month
FEMA the deal we've got ready to go is
as I say that it does protect the supply
chain in a sense there's a slight
tension there because if you have
equivalents of standards that is
acceptable to the European Union
acceptable enough to give us access to
the market there has to be some form of
EU oversight and that the government
won't accept as for the supply chains
the moment you're outside the customs
union then there is going to be friction
and if we don't have a EU regulations
that friction is
gonna be worse so I think for the
automotive industry the farmer industry
the aerospace industry they are going to
face problems because their business
models rely on just-in-time supply
chains that will no longer function as
they do now this election didn't just
crush resistance to brexit but change
conservative spending priorities no
longer just a nod to their long promise
regionalism but today a commitment to
finance projects in those former labor
strongholds on top of that an ambitious
pledge to double the country's economic
growth rates
well it's certainly very ambitious and
I'd say ambitious to the point of almost
being fantasy economics there are a
whole host of reasons why he will
struggle to get that kind of growth rate
in this Parliament so investment takes a
long time to feed through into economic
growth he's also got this brexit
uncertainty because of the limits of the
31st of December for that determining
that new trade deal and then you've got
all these problems occurring in the
global economy so I think he's going to
struggle for the 2.8%
even if he does get the growth rate up
there's still big issues to be settled
for business today the CPI welcome the
vision but warned against diverging from
EU regulation for the sake of it and
although the UK's vision post breaks it
is now clearer there's two sides in a
negotiation and that part hasn't even
begun
well I'm joined now by the chief
executive of the food and drink
Federation Ian Wright how is this going
to affect your members well it depends
how much friction there is in the system
after the negotiation and I think that's
the key point the Chancellor said today
or said in his interview
incidentally conducted rather
appropriately in a sandwich shop that he
was what he wanted us to move away from
the EU not to be a rule taker
but he was very unclear on which
regulations he wants to keep and how the
whole process will work we think this
can be all worked out and we also think
that the ambitious free trade deal with
the EU and probably trade deals with
other countries like America and
Australia which we welcome and look for
we think that that can be a negotiation
which ends with a relatively low
friction process and that's the test we
set for the government if these
negotiations are
succeed for manufacturing industry there
has to be the minimum possible friction
right but does it mean that prices will
rise if there is any friction in the
system because that adds delays and more
work yeah more friction equals more cost
equal and that cost has to go somewhere
and it either goes to price or it goes
to lower wages or it goes to lower
returns for investors or more likely all
three there's nowhere else for it to go
that's how we cannot the economics of
the industry works and in food and drink
we're operating on margins of 2 and 3%
so any increase in cost either from
extra paperwork or more tech more checks
or indeed from tariffs for some reason
will make us an economic and a fifth of
our product which goes to the EU will be
at risk so you can make it work yeah we
can get brexit done but we will pay for
it it'll cost us more now the Chancellor
has sort of implied that you know you've
had three years to work this out as if
you could have been doing something
about it what could you have been doing
in those three years that you haven't
done well since the Chancellor doesn't
know which regulations will apply and
which won't
and since our colleagues in Defra don't
know and since we've had as your
correspondent pointed out to full starts
on a No Deal break set and we still face
the prospect a maybe remote of one on
the 31st of December it's a little bit
difficult to know what industry should
have been doing when government itself
didn't know what it was doing so you're
still just waiting basically there's
nothing more you can do now even after
this statement you've just got to wait
and see what happens no we're in active
discussions with the government and I've
got very high hopes actually of how this
will work I'm an optimist our industry
is is very positive about the way we can
move forward with government and I've
got a lot of confidence in people like
Michael Gove if they're doing the
negotiation that they will deliver but
as I said just now the test when we
deliver is to deliver free trade param
when you say deliver do you mean deliver
something that doesn't involve higher
prices or do you or a higher price is
just I know it'll now
no no I mean deliver something with the
minimum possible friction it will be the
amount of friction in the system checks
tests paperwork delays which dictate
whether prices rise or not in right
thank you very much