UK Brexit customs idea slammed as naive

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UK Prime Minister Theresa May has recently confirmed that Britain will not stay in a customs union with the EU. AFP

LONDON (Reuters) – British manufacturers turned up the pressure on the government to abandon one of its post-Brexit customs proposals yesterday, slamming the idea of a technology-based plan for border checks as naive and a waste of money.

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Prime Minister Theresa May has ruled out Britain staying in a customs union with the EU bloc – to the dismay of many employers groups – and says her government is working on two possible solutions to minimise delays at Britain’s ports and airports.

But the EEF manufacturers’ body said it was unrealistic and naive to think a technological border solution, known as “max fac,” or maximum facilitation, could be implemented by the time a planned Brexit transition period ends in December 2020.

“It may have some long-term benefits, but suggesting max fac is a solution to our immediate problems is a non-starter,” EEF Chief Executive Stephen Phipson said in a statement.

Mr Phipson said a max fac-style arrangement at the US-Canada border had not eliminated the need for checks on most goods.

The customs conundrum – which will define commerce between Britain and its biggest trading partner for decades – is a test of Ms May’s leadership as she tries to pacify rival factions in her Conservative Party and her cabinet.

She also needs to win agreement from Brussels where officials have dismissed both the options being considered.

The max fac option is favoured by Erosceptics in Ms May’s party who want looser ties with the European Union after Britain leaves the bloc.

But last week Britain’s most senior tax official said such a customs arrangement could cost businesses up to 20 billion pounds ($27 billion) a year.

Under the other option, Britain would collect tariffs on imports from outside the bloc on the EU’s behalf.

A senior EU official last week dismissed as “fantasy” some of Britain’s main demands for Brexit, including on the Northern Ireland border. Chief negotiator Michel Barnier urged Britain to stop playing “hide and seek.”

Ms May’s spokesman yesterday criticised what he called “sound bites and negative anonymous briefings” and called for a more constructive tone to the negotiations.

The EEF has previously urged the government to give businesses clarity on what Brexit will look and has warned of possible damage to complex cross-border supply chains.

Last week another major employers’ group, the Confederation of British Industry said remaining in a customs union was currently the only workable option for Britain. Finance minister Philip Hammond rejected that view.

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