David Martin MEP

Labour Member of the European Parliament and one of the six MEPs representing Scotland in Brussels and Strasbourg

Brexit policy should focus on damage limitation

The Times, 19 December 2016

John Longworth’s Red Box article “Brexit means cheaper food for Britons” displayed an alarming lack of knowledge about the EU’s trade policy as well as a reckless disregard for the wider UK economy.

His chief policy, leaving the single market and unilaterally reducing tariffs on all products, might indeed mean some cheaper goods in British stores. But what Mr Longworth failed to mention was that this strategy would “effectively eliminate manufacturing” in the UK, as well as pricing other export sectors out of international competitiveness. Not my words but those of Professor Patrick Minford, the economist cited in his article.

Slightly cheaper food is no good to people who have seen their jobs and communities decimated by unregulated imports.
In addition, these price gains would more than likely be offset by the other negative consequences of his preferred hard brexit scenario, namely a reduction of GDP of 7.5 percent — according to Treasury figures — and a drastic reduction in purchasing power thanks to the plummeting pound.

Furthermore, he then contradicts himself by declaring that “we would need to protect strategic industries, including agriculture”. This protection of the agricultural sector and other sensitive industries is exactly why the EU places tariffs and regulations on certain products in the first place. They ensure both a decent wage for British farmers as well as high quality products for consumers.

He goes on to mention oranges and bananas. He might be interested to learn that the EU this week ratified a trade deal with Ecuador, the world’s largest exporter of bananas, for reduced-tariff access to our markets. In June the EU also signed a deal with South Africa and its neighbours, which liberalises trade in out of season oranges, exactly the “new” kind of policy that he suggests in his article.

This is on top of the 50 fifty or so countries with whom the EU has already agreed preferential trade agreements. It is also on top of the unilateral tariff-free and tariff-reduced access for fruit, vegetables and a whole host of other products that the EU already gives to the world’s developing economies through different schemes, providing cheaper food for British families as well as helping those countries to grow.

It is clear that the majority of things Mr Longworth was calling for already exist within the EU’s internal market and its external trade policy. Outside the EU the UK will have to try to set up a similar tariff regime with other countries, although we are extremely unlikely to get as good a deal because of our relative lack of size and clout in trade negotiations.

The British farming and food industry have made it very clear that Brexit would mean rising food costs. We should now adopt policies that respect the will of the people but that can limit the damage. Policies that do not harm the long-term economic health of this country and are not detrimental to the prices and choices to which Britons are used.

Maintaining our membership of the single market is the first and most important step towards achieving these goals.
The British people voted to the leave the EU but they did not vote to become poorer. Nor did they vote for a free-market ideology that will exacerbate the problems many voters thought Brexit would solve.

Exiting on the terms proposed by Mr Longworth and his allies risks doubling down on the negative economic consequences of Brexit. It would be disastrous for ordinary working people and must be avoided.

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