Business groups have praised today's "milestone" Brexit announcement that the UK and EU have struck a transition deal - but urged negotiators to get urgently stuck into the detail of the future trading relationship.
Monday 19 March 2018 1:01pm
David Davis and Michel Barnier confirmed the terms of transition today (Source: Getty)
The two sides have reached "complete agreement" on citizens rights and the divorce bill, but the Irish border continues to remain unsolved.
The deal means the UK will be able to negotiate trade deals during the period - which will run until 31 December 2020 - but remain part of the Single Market and customs union. The UK will also therefore be bound by EU rules but will not have a say on any decision-making.
Davis said the breakthrough would give businesses much-needed clarity, and it received a qualified thumbs up from industry groups.
Carolyn Fairbairn, director general of the Confederation of British Industry, said: "This is a victory for common sense that will help protect living standards, jobs and growth. It shows what can be achieved when people and prosperity are placed above politics and ideology.
“With a year to go, this breakthrough must set the pattern for the future. Other hurdles on the Brexit path now need to be cleared in the same spirit, including urgent resolution of the Irish border."
Adam Marshall, director general of the British Chambers of Commerce, said: "This is a milestone that many businesses across the UK have been waiting for. The agreement of a status quo transition period is great news for trading firms on both sides of the Channel, as it means that they will face little or no change in day-to-day business in the short term... Many companies will now have the clarity they require to proceed with investment and hiring strategies that would otherwise have remained in question."
He urged the EU27 not to turn transition into a "political football", and said both sides must "adopt a laser-like focus on the future trading relationship – and swiftly conclude a deal that minimises further adjustment costs and that answers the many practical questions that trading businesses still face".
In the City, the chief executive of the Association for Financial Markets in Europe (AFME) Simon Lewis, said transition was "a major step forward".
"We look forward to seeing more details at the EU summit later this week," he added. "While this agreement is a big move in the right direction, it will be important to see that there is real political and regulatory commitment from both sides to a transition period.”
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Policy Chairman of the City of London Corporation, Catherine McGuinness, added: "Today’s announcement lifts some weight off the shoulders of firms in the UK and the EU. Before the announcement firms were peering over the precipice. They are now on firmer ground and we hope that the regulators will be tasked to work together by the UK and EU to underpin this political commitment and give firms the certainty they need.
“But there are still a number of areas to be resolved – notably the Ireland and UK border issue. Government has made great progress in recent weeks. It’s vital we find a resolution to this issue as soon as possible.”
Miles Celic, chief executive of TheCityUK, said: “This is a critical milestone in the Brexit negotiations and it meets the first of our industry’s three key Brexit priorities – a status quo transition arrangement to reduce uncertainty and ensure an orderly withdrawal. We have argued strongly that this needed to be in place early this year, and we are very pleased to see this achieved.
"Negotiators must seize on this progress and use it to press on towards agreeing an ambitious vision for the future. One which builds on our close trading partnership in goods and services and strengthens European growth and financial stability.”
Allie Renison, head of Europe and trade policy at the Institute of Directors, said: "Business leaders will welcome the announcement of a provisional agreement on an implementation period and congratulate the UK government for heeding the call of business and making it a priority early on. Knowing that trade and immigration arrangements will continue unchanged until at least the end of 2020 will allow business operations and investment decisions to carry on without unnecessary disruption for the time being.
“We are, however, concerned that not enough attention is being given now to the finer details and practical implications of transition. Many businesses will only be able to sufficiently plan and prepare for Brexit once the precise details of the future relationship are known, and any changes to domestic infrastructure like customs have been implemented."
But not everyone was pleased.
The leader of the Scottish Conservatives Ruth Davidson said: "During these negotiations, we wanted to gain control over our waters from as early as the end of next year.
"The EU was not willing to move on this. That we now have to wait until 2020 to assume full control is an undoubted disappointment.
"Having spoken to fishing leaders today, I know they are deeply frustrated with this outcome. There is no ignoring the fact that this falls short of what they had hoped for in the short-term."
Davidson, who is seen as possible contender for future Conservative leader, added: "Over the long-term, today's agreement makes clear that, from 2020, the UK will be an independent coastal state, deciding who can access our waters and on what terms.
"I am more determined than ever to ensure that this long-term prize for our fishing industry is seized.
"So I should make it clear today that I will not support a deal as we leave the EU which, over the long-term, fails to deliver that full control over fish stocks and vessel access."
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