Brexit Negotiations After Article 50: Assessing Process, Progress and Impact

One of the most heated discussions regarding Brexit is over the nature of any future trade deal the UK is going to sign with the EU. There have been endless discussions since the referendum result about this crucial aspect question and nothing has been so far agreed. Some analysts, however, have already pointed to a series of issues that anything different from the status quo could cause. The case analysed in the following pages serves as a cautionary tale, and there is an important reason for that. It is a good illustration of the issues that can emerge when countries are members of some forms of regional associations but not of others and whose consequences can produce spill-overs from pure trade matters to more serious security concerns.

It is not very often that something as common as the import and export of agricultural products – especially non-exotic fruits and vegetables – becomes the object of such a dispute across multiple states. This is what happened in the now infamous case of Chinese garlic exports, which have seen several instances of smuggling, conviction, and fraud all over Europe in the last 20 years. Most incidents have taken place in Northern Europe, particularly Sweden, Norway, the UK and Ireland. There’s a reason for that, which will be explained below.

One of the most heated discussions regarding Brexit is over the nature of any future trade deal the UK is going to sign with the EU. There have been endless discussions since the referendum result about this crucial aspect question and nothing has been so far agreed. Some analysts, however, have already pointed to a series of issues that anything different from the status quo could cause. The case analysed in the following pages serves as a cautionary tale, and there is an important reason for that. It is a good illustration of the issues that can emerge when countries are members of some forms of regional associations but not of others and whose consequences can produce spill-overs from pure trade matters to more serious security concerns.

It is not very often that something as common as the import and export of agricultural products – especially non-exotic fruits and vegetables – becomes the object of such a dispute across multiple states. This is what happened in the now infamous case of Chinese garlic exports, which have seen several instances of smuggling, conviction, and fraud all over Europe in the last 20 years. Most incidents have taken place in Northern Europe, particularly Sweden, Norway, the UK and Ireland. There's a reason for that, which will be explained below.

This chapter explores the possible future trading options available to the UK and what impacts these trading options will have on the UK automotive industry. The research makes use of a wide range of data to predict the degree of impact each trading alternative will have on the UK automotive industry. Using a Supply Chain Management (SCM) framework, we discuss the trading practices currently in place today in the sector, and its interactions and dependence on privileged access to the Single Market. We then examine likely impacts each potential trading alternative will have on the sector. Drawing on interviews with senior managers in the sector, the findings of the research suggest that all current available trade scenarios put up different types of trade barriers for the sector, potentially increasing costs and decreasing the UK’s attractiveness as a base for automotive manufacturing. The findings also suggest that the uncertainty around the UK’s trading future with EU is deterring investment into the sector, which will likely have consequences further into the future. We conclude by assessing a wide variety of mitigation strategies open to manufacturers, considering their viability and applicability in each potential scenario.