Abu Dhabi, UAEMonday 30 March 2020

UK finance chief: some businesses may hurt after Brexit

Britain is set to leave the European Union on January 31

Britain wants to agree a trade deal with the European Union. Reuters
Britain wants to agree a trade deal with the European Union. Reuters

The British government has announced plans for special events on the night of January 31 when the country officially leaves the European Union but the country's finance chief has admitted that some UK business sectors will suffer as a result.

Sajid Javid told the Financial Times in an interview on Saturday that Britain's regulations will not be aligned with the EU in the future and that those changes may hurt some businesses. Currently, the EU is Britain's largest trading partner.

“There will not be alignment, we will not be a rule-taker, we will not be in the single market and we will not be in the customs union — and we will do this by the end of the year," he said, referring to a deadline at the end of 2020 for the conclusion of what are expected to be contentious trade talks with the EU.

Mr Javid's comments sparked fresh concerns among business leaders worried about that lack of clarity on the substance of the trade rules that would take effect in less than 12 months' time.

Food and Drink Federation chief Tim Rycroft gave a warning that diverging from EU rules could lead to higher food prices for consumers.

“It will mean businesses will have to adjust to costly new checks, processes and procedures that will act as a barrier to frictionless trade with the EU and may well result in price rises,” he said.

The Society of Motor Manufacturers and Traders emphasised the need to avoid high tariffs and other trade barriers once EU ties are severed.

Chief executive Mike Hawes said “billions” would be added to the cost of business development unless a mutually beneficial agreement is reached.

Britain will officially leave the EU bloc on the night of January 31 even though it will keep following EU rules for an 11-month transition period. It will be the first nation to leave the bloc. The British government plans to mark the occasion with a series of upbeat events.

British Prime Minister Boris Johnson plans to make a speech to the nation that night after holding a rare Cabinet session in the north of England to emphasise his government's plan to spread opportunity to that economically beleaguered region.

The government also plans to mark Brexit by projecting a clock on to the prime minister's official residence at 10 Downing Street in London that will count down until 11pm, when the break takes place.

The entire government neighbourhood of Whitehall is to be illuminated for the occasion as part of a light show, with Union flags flown on all the poles in Parliament Square. The government will also create a commemorative coin that will enter circulation that day.

But Mr Johnson's Conservative government is no longer actively pushing a plan to have the familiar chimes of Big Ben sound at 11pm despite a private fundraising push in support of activating the chimes, which are under repair.

Britain voted in a 2016 referendum to become the first nation to leave the 28-nation EU, but the process has moved more slowly than expected. A stalemate last year kept a withdrawal bill from passing, leading to a rare December election that gave Mr Johnson's pro-Brexit Conservative Party a strong majority in Parliament.

The Brexit divorce bill quickly passed when the new Parliament convened.

Mr Johnson, who is also seeking a trade deal with the United States, has ruled out seeking an extension of the deadline for the EU talks.

Updated: January 19, 2020 09:39 AM

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