A View From Westminster: Customs Union

All the talk here at Westminster, is about the customs union. For those that are not following the Brexit debate closely, the customs union is a trade agreement of two parts. First, the parties agree, that they will not charge tariffs or import duties on each other’s goods. Second, they agree that they will charge the same tariffs as each other on imports from other countries. It also means that members cannot negotiate their own Free Trade agreements elsewhere.

The Government has officially ruled out any customs union with the EU but has proposed different kinds of customs arrangements; “a customs partnership” which allows us to set our own tariffs, or a “highly streamlined customs arrangement” a plan for managing checks, rather than eliminating them.

Whatever the final outcome, one thing is certain, trouble is bubbling below the surface here at Westminster. The Remainers, whose numbers are strong in the House of Lords, and EU negotiators, are clearly ganging up in a push to reverse Brexit through the back door. The cabinet is split. So is the country. But compromises on both sides need to be made as the Referendum vote, was a narrow one.

Although I voted Remain, I am concerned that joining a Customs Union would mean that Britain could not trade on its own terms to its competitive advantage; Britain would be crippled by EU trading laws without having any say over them. It would therefore be worse off than before Brexit. In effect we would be back in the EU fold with none of the advantages.

The EU cites the problem of Northern Ireland. They say without a Customs Union we would have to return to a hard border. But Switzerland isn’t in the Customs Union and sells to the EU five times as much per capita as does Britain. Yet many of its EU crossings are unmanned, some even invisible. On the other hand, Turkey, which is in the Customs Union, has a frontier far more heavily policed than the Swiss one. And worse, it also doesn’t get automatic access to new partners but has to open its own market to them. Of course, the way to avoid checks in Ireland is to have a comprehensive trade agreement between Britain and the EU that provides for mutual recognition. This is what Theresa May has been trying to achieve.