Home Spring 2018

Spring 2018

As the government discusses post-Brexit deals, Andrew Denton, CEO of the Outdoor Industries Association (OIA), discusses what the future could entail for the UK outdoor trade

It’s 2018 and the year has started with polar weather and fairly brisk sell-through, an upbeat ISPO and the news that the Outdoor show is moving to Munich – finally no more camping and communal showers at the trade show!

We do, however, seem to be mired in an ever more elusive Brexit plan, with the customs union now an increasing issue and the deadlines fast approaching. For brands exporting, retailers importing and retailers competing with European online discount stores this is a big deal – so what are the options?

The Prime Minister announced this week that the UK will leave the single market and will not remain in the customs union. So, what does that mean?

“The customs union ensures all countries charge the same import duties on goods and services brought into the union and prohibits members charging tariffs on those goods/services when they cross borders within the union.”

This says nothing about free movement of labour and does not set rules on working conditions, labelling or product quality. However, to my understanding, it does prohibit us from making our own independent deals with Australia, Canada and the USA – one of the main ‘benefits’ of Brexit? You want to be in the customs union? You work as a block on trade deals.

So, the choice then is to leave the frustrating EU regulations and red tape, therefore regain the right to negotiate our own trade deals with countries outside the EU such as the USA, thus boosting our trade significantly? Well no, if a product is labelled for US and UK sale and compliant with our new post-Brexit easy sell, low regulation environment that might be great in theory, but the EU won’t buy it – they can’t. If a product or service is for sale in that market it needs to be compliant. You want to sell to the largest market in the world? You have to comply with their rules – why do all those USA brands put French neck labels in their clothes?

So, whilst the government aims to negotiate a free-trade deal with the EU with no tariffs, under any such an agreement the UK will still have to comply with EU standards for those exports, but it will have no influence over what those rules are. Remember that the European Union is enshrined in the ‘four freedoms’, sacrosanct to Brussels policymakers – free movement of goods, services, capital and labour.

On this side of the channel the utopian post-Brexit dream seems to be free movement of the first three but without the regulation or compliance, and without the fourth free movement of people? There appears to be no chance whatsoever that we will gain an unregulated, noncompliant product and services market that’s free to export to – the red tape appears to be as basic to selling into the EU as crossing the channel.

So, assuming the red tape and the Euro-bureaucracy can be born, we’ve done it 40 odd years, we can continue without much pain – but does that mean we could still negotiate our own unique deal in addition? No, I believe that is disallowed if we are within the customs union. In addition, can we even consider having access to that single market – three of the four free movement principles, without the forth? Yet surely any Brexit deal has to cancel the ‘free movement of people’ – it was a core issue of the vote?

Well no one has done this before, and there’s the rub for the government – they want to deliver red tape free, no-euro rules? Not going to happen. You want to set up independent trade deals with the rest of the world? Watch out you don’t jeopardise your deal with the largest trading block in the world. You want to do all this, get three out of the four enshrined principles without paying with the fourth? Now I begin to understand the weakness of the GB negotiation position.

There is an easy solution that fits with the majority vote – we don’t remain in a customs union and are totally free to negotiate our own international deals with the rest of the world. We shun the EU regulations as too much red tape, and simplify, go back to common sense English labelling. We regain control of our borders and restrict immigration to a points system, allowing only people who we think will really contribute to the UK economy.

Easy solution, in line with the vote – the challenge for the government is that it will cripple us economically, to replace 40 years of trading with the EU over night? Not in a million years. Doesn’t it make you glad we are only arguing over a summer trade show in Munich or Friedrichshafen….?! Write to me with your thoughts at andrew.denton@theoia.co.uk.