No-Deal Brexit: Experts Explain How Leaving EU Without A Deal Will Affect British Business
8 August 2019, 08:15 | Updated: 8 August 2019, 08:21
Boris Johnson has promised the UK will leave the EU with or without a deal on 31st October - and that makes a no-deal Brexit a distinct possibility.
There have been warning of traffic chaos around ports and shortages of food and medicine.
So how do you separate Project Fear with Project Fact? LBC spoke to a range of business leaders from fishermen and fruit buyers to freight and terror police to find out what the UK will look like in the event of a no-deal Brexit.
How No-Deal Brexit Will Affect Fishing Industry
Fishermen are among the most ardent Brexiters, angry with the Common Fisheries Policy, which they say severely hampers their business.
LBC reporter Matthew Thompson went to Fraserburgh to speak to them and, while they still want to leave the EU, the bosses of the company warn that the customs problems caused by a no-deal Brexit may kill the industry.
Graeme Sutherland, the director of Whitelink Seafoods, told LBC: "As a company, we export into Europe at a rate of 85-90% of what we produce here.
"We are working on a next-day delivery into France for distribution into Europe. So if we are delayed in any way in clearing customs, in effect, we are going to lose 24 hours on delivery.
"We need frictionless borders. It has to be that for our industry to survive."
How No-Deal Brexit Will Affect Fruit And Vegetables
From increased tariffs and prices to simply not being able to get enough fresh fruit and vegetables, John painted a bleak picture.
He said: "Under WTO rules, we'd have to apply tariffs. These are extraordinary at times. The salad I buy has a tariff of 10%. We reckon every 1% of trade tariff will cost us £10-15million. Multiply that by 20 and you're looking at £200-300m in tariffs.
"You've then got the impact of weakening exchange rates. During the referendum, the exchange rate tanked and we took massive hits internally. We passed some on to the consumer, but we absorbed some. But there's no way we'd be able to absorb any more.
"For every 1% weakening - and it dropped 18% last time - it's going to affect our cost of goods by 0.8%. So if it drops by 10%, you're looking at a 10% cost increase.
"You've then got the problem of availability - and this is a shocker. Fruit and vegetables are the fourth priority for the government, so we've been told we will be given 25% availability of our lorries to pass through Dover ports. So from what we have now, we have to quarter what we take in from the EU. That's before we get the gridlock of the remaining 25%
"We can get them from countries outside the EU, but these all have trade deals with the EU on an Anything But Arms basis. We won't have that."
How No-Deal Brexit Will Affect UK Security
The UK's most senior counter-terrorism police officer is warning a no-deal Brexit would be "very bad" for the security community in the UK.
Neil Basu says it would mean a loss of access to EU data systems, and it would be more difficult to extradite criminals and terror suspects.
He said: "A no-deal Brexit for the security community, certainly for policing would be very bad for the security of this country and very bad for Europe as well.
"What it means is losing a lot of access to some significant data sets, from significant ways of working in terms of sharing information across the border, sharing biometrics, fingerprints and DNA across the border.
"Also, things like the European Arrest Warrant, which allows us to arrest and extradite people, to get people back who we want and prosecute in this country from Europe.
"All of those things will revert back to old-fashioned techniques, which will be very clunky and cumbersome. And the longer it takes to process intelligence, the more risk you sit on."
How No-Deal Brexit Will Affect Medicines
The Chief Executive of the Association of the British Pharmaceutical Industry has told LBC a no-deal Brexit "should be avoided at all costs."
Mike Thompson's revealed the Government has plans to airlift medicines into the UK, if there's major disruption as a result of extra border checks. He says the building of stocks for a no-deal scenario is the "biggest logistical challenge" the industry has ever faced.
When asked if stories of medicine stockpiling are true, Mr Thompson said: "Yes it is. Absolutely. Every member is doing that.
"That's why patients can be reassured that we are doing everything in our power to ensure we can get our medicines to them even though this is the biggest logistical challenge we are facing.
"Our message is, when parliamentarians come to think about the options in front of them, no-deal is something which they should avoid at all costs because of the challenges it will give everybody.
"I don't want to get involved into the politics of all of this. I'm just saying that no-deal creates significant challenges for us. We are as prepared as we can be, but undoubtedly things will go wrong."
How No-Deal Brexit Will Affect The Freight Industry
The chairman of a major British freight company has told LBC that they won't be able to cope if the UK leaves the EU without a deal.
Nick Ferrari spoke to Ian Baxter, the Chairman of Baxter Freight, one of the UK's fastest growing logistics businesses who said his company won't be able to deal with the huge increase in customs checks that would come with a no-deal Brexit.
He said: "It's going to be an extra 300million customs clearances. Frankly, HMRC won't be able to cope with that. Neither will Baxter Freight. Neither will our customers if that happens.
"If there is a sensible transition period, then we'll have an opportunity to gear up to it, which is what we're hoping for.
"If we leave without any arrangements with the European Union then impossible might be a good word. It would certainly be chaotic. It would be a disaster for British business if we are to leave in that way."