There have been numerous Brexit updates this month, with everything from unemployment falling, to concerns over potential queues at the border. So, in SquareOne’s first political update, the SquareOne team have broken down the top stories from August to give you a roundup of everything you need to know about Brexit this month.
Great news to kick us off with! Unemployment in the UK fell to 4.4 percent which is the lowest it has been since 1975. In a response to this, the pound rose.
This is great to see as it shows the UK’s workforce is on the increase. The pound rising, is always a great one, as it attracts international businesses. It also appears that businesses have confidence in the British economy as they are taking on new staff.
British factory production is also at a 22-year high.
EU Talks Delayed
It has been reported that the next phase of Brexit talks may be delayed from October to December. "Sufficient progress" on phase-one negotiations on money, citizens and Ireland had been pencilled in for October, but the talks could be delayed if London decides to hold fire and wait for the new German government.
Between now and the October European Summit, three negotiation sessions have been scheduled. According to Brussels sources, these are likely to be fact-finding sessions. With the first of which having started on August Bank Holiday Monday (Monday 28th August), all before the “crunch time” in September and October, according to Brussels sources.
Potential Queues at The Border
There have been concerns raised that once the UK leaves the EU there could be tailbacks either side of the Channel, if customs authorities cannot cope with excessive customs declarations. However, Swiss and Norwegian trucks cross into the EU daily without major delay and neither country is part of the EU customs union. The hope is this will also be the same case for the UK.
Michael Ambuehl, a professor at ETH Zurich who was the chief negotiator of Switzerland’s second set of bilateral agreements with the EU, has said that: “Due to the highly digitalised ‘paperwork’, the hurdles at the border are small. The border controls are few in numbers; they are random checks based on risk evaluation.”
The UK and the Customs Union After Brexit
The countries within the customs union, of which the UK is currently one, levies taxes on imports on some goods that arrive into the country. There is no tariff in place between goods from countries within the EU customs union, but the tariff is imposed on all international imports.
The UK has said it will leave the customs union because it is unable to strike trade deals with other countries whilst it is a member. However, it is anticipated that the UK will mirror much of the system.
David Davis, Secretary of State for Exiting the European Union, has said that a “cliff-edge for businesses and individuals on both sides” will be avoided by procedures that are being set out to benefit the UK and EU.
Davis went on to say: “The way we approach the movement of goods across our border will be a critical building block for our independent trade policy. An interim period would mean businesses only need to adjust once to the new regime and would allow for a smooth and orderly transition.”
Proposals to ensure that trade in goods and services will continue to the day in March 2019, when the UK leaves the EU. A position paper requests that goods already on the market be allowed to remain on sale in the UK and EU without extra restrictions and for consumer protections remain unchanged.
Davis believes that “these papers will help give businesses and consumers certainty and confidence in the UK's status as an economic powerhouse after we have left the EU.”
The UK economy could be enriched by the removal of trade tariffs and barriers as £135bn could be accumulated annually, according to a group of pro-Brexit economists.
Overall there are some great updates for the UK economy, as takeaways from August, with Brexit continuing to be at the forefront. Check back next month for our next political update. If you are considering expanding your business into the UK, check out our blog of the top UK cities to start a business in or get in touch at email@example.com to see how we can help your business.