Getting the best Brexit deal has taken on greater urgency

As the nation faces the global financial aftershock of coronavirus, the success of Brexit negotiations in an uncertain world is even more vital than ever, as former Lancashire MEP Sajjad Karim explains

By Mike Hill
Monday, 22nd June 2020, 12:30 pm

Change is a constant in history. It can come in a variety of forms. A total arrest of the globe, to virtual standstill, which then acts as an accelerant of multi-dimensional change is mega disruption simultaneously at macro and micro level.

International institutions, national governments, individuals all caught instantly in silent suspension, simply awaiting the moment we can crank up the engines of our individual economic generators with a whirlwind to be unleashed and hopefully thereafter an upward trajectory without a downward spiral to follow.

So many in Lancashire and beyond were already seeking both an arrest to the change happening to their towns and communities, and then the implementation of another change which would reinstate a historical surrounding, perceived or otherwise, that they better recognised. A process of which they would be in control.

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Former Lancashire MEP Sajjad Karim

Covid, Brexit, technology, artificial intelligence and disruption combined are clearly going to create change at a pace not seen by us ever before. Economic challenges at a national and personal level have the ability to add to a feeling of lack of control. Lancashire is no stranger to coping with and playing a leading role in economic revolutions and hopefully that history remains in our DNA today.

We will be dealing with these challenges for quite some time. Of them all, the only one over which we have any real control is the timetable for Brexit. It remains a matter of debate as to what the effects of a no-deal Brexit would be for the UK, as the Government still refuses to publish the impact assessments, but it must now be clear that in current circumstances it will add to our burden rather than take from it.

The other aspects we can hope to influence include the development of a vaccine for the coronavirus. A global race is underway as great geo-political power and economic gains come to the first developers. The after-effects will shape the globe for decades to come. Technological advancements, artificial intelligence and disruption will in so many ways bring change beyond what can be envisaged and within an accelerated timeframe.

If the pace of change pre-Covid was enough to render people to believe matters were out of their control, policymakers and leaders globally need to be prepared for both the scale and reaction to the uncertainty potentially facing us now.

Whatever the changes ahead, they will have to mould within existing international structures. For example, any trade agreement we reach with the USA will have to mould around pre-existing trade arrangements between the USA and the EU and whatever, if any at all, agreement we arrive at with the EU. In fact, any trade negotiations we undertake with anyone will always have as a starting point the question, “what are the existing trade mechanisms between that country and the EU?” The answer will determine what space is left for us to negotiate within.

Equally, the lack of reaching agreement with the EU means we must apply World Trade Organisation rules. Those who argued the European Union was complex, slow and cumbersome haven’t seen anything yet if we do find ourselves operating in a WTO framework alone. The established WTO rules of trade are themselves today under challenge by both the leading powers of the east and west.

We certainly live in interesting times which are about to get much more interesting. The emergence of a bi-polar world lead by two distinct powers, the USA and China, uneasily attempting to retain or grab influence through finance, regulation and territory make for quite a rocky terrain to navigate.

But navigate it we must. As the USA, China and the EU will increasingly between them set the worlds trade operating manual and rules, everyone else will have to simply try to influence their decision making and ultimately comply.

When one introduces the challenges being foisted upon our other seats of influence including NATO and UN, very quickly a new reality begins to emerge. This is a new reality that is going to take some getting used to for a country like ours, but it is a reality that will play out among a huge amount of change at every level that we may well just be able to not openly acknowledge the true ramifications of it within our own shores, for now. All of this has very direct consequences for Lancashire and its people. The

Government had pledged a Northern Powerhouse levelling up for the north. It is very difficult to see how that cannot at the very least now be delayed by several years. Economic challenges while we restructure ourselves within the international rules that must apply is invariably going to affect our market access globally.

Processes will be more cumbersome and cross border supply chains will slow down or break down. New domestic supply chains and opportunities will, however, be created but a domestic UK alone market supply chain is seldom enough to satisfy a long term business and economic case that is sustainable at a macro scale.

Lancashire’s MPs really must be sure of the extra burdens they are about to place on people by not using the extra time that is readily available in negotiations with the EU, after all we have now left and fulfilled the referendum result but risk undermining that by not delivering an agreement for the future.

In both Covid and Brexit we have been told the “common sense”, “resilience” and “true grit” of the British people is what would pull us through no matter how huge the challenges. There is no shortage of any of those characteristics in Lancashire, but it would be a tremendous help if burdens that can be removed by our leaders, are removed. Otherwise, it is the leaders themselves who will face the removal.

Sajjad Karim was a Lancashire MEP from 2004-19 and awarded Dods Parliament Magazine 2019 prize for International Trade. He is CEO of Haider Global Strategic Consulting