EU trade deal '˜vital' to avoid damaging agriculture

A cross-party group of MPs has warned the UK government of the damage that could be done to agriculture by going down the route of World Trade Organisation (WTO) rules if it fails to get the Brexit trade deals it desires.

MPs warned that farming would suffer under tariffs set by the WTO. Picture: Michael Gillen
MPs warned that farming would suffer under tariffs set by the WTO. Picture: Michael Gillen

The international trade committee, which was established last autumn to look at options in a life outside of the European Union, has warned that major industries including farming and car making would suffer if no trade deals can be established before leaving Europe and the UK reverted to trading with the rest of the EU under punitive tariff barriers set by the WTO.

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The committee of 11 MP accepted the evidence of the English NFU, which suggested farm incomes could fall by an average of £17,000 per annum under those circumstances.

MPs said this potential loss of income, made it essential a trade deal was done prior to leaving the EU in 2019.

The report stated: “It is quite clear that ‘no deal’ is in effect a deal to trade with the EU under WTO rules.

“The Prime Minister has said that it is her ambition to seek tariff-free trade with the EU and frictionless customs arrangements. It is clear that WTO rules would not permit this. Therefore, the ‘no deal’ option should be discounted entirely.”

The committee also looked at the burdens to trade arising from the creation of customs barriers with the danger of “costly and cumbersome rules”.

It called on the government to clarify what exactly it meant when it said it did not want a customs union with the EU but was looking for a “customs arrangement”.

One area of potential future trade which gained approval from the committee was with the European Free Trade Association, where MPs said they had been “impressed” by the potential benefits offered by this option.