Brexit: Prepare for worst case scenario, says FTA

Brexit: Prepare for worst case scenario, says FTA

The Freight Transport Association (FTA), has reacted with frustration to the lack of progress in Brexit negotiations, advising logistics companies to "prepare for the worst case scenario" now.
 
FTA said companies responsible for moving the UK’s goods and services between the UK and Europe need urgent answers to keep Britain trading and clear directions on required Brexit preparation, beyond the no deal notices.
 
Pauline Bastidon, FTA’s Head of European Policy, commented: “With March 2019 fast approaching, it’s frustrating negotiators on both sides have still not reached an agreement and seem content to once again kick the can down the road. We are now being told that decisions could be postponed to the December EU summit. While the logistics industry understands negotiations are complex, politically-sensitive and time-consuming, there are massive decisions which need to be made urgently by companies and cannot be left to the last minute. Given the scale of adaptions required in the event of a No Deal exit, an outcome which cannot be excluded at this stage, we are quickly reaching the point of no return and industry decisions cannot be delayed any longer. 
 
“Months ago, FTA listed a number of key elements on which we needed answers to and clear decisions on as part of our ‘Keep Britain Trading’ agenda. With less than six months left until Brexit, we are forced to recognise that progress on these items is extremely limited. Even the transition period is not a certainty at this stage. The current state of uncertainty leaves the logistics sector in limbo, as our members are forced to plan for an uncertain future. They face two choices: invest in and implement contingency plans that might not be needed if an agreement is reached, or take no action and risk being unprepared in the event of a No Deal exit.
 
"FTA advises all companies to begin preparing for the worst-case scenario and calls upon the Government to give clear directions to industry, building on the no deal notices and focusing on the points of greater concerns to the industry, from detailed information required to prepare for possible customs formalities to post-Brexit immigration rules. Contradictory signals are unhelpful and risk giving industry a false sense of security." 
 
She continued: “Given the increased likelihood of No Deal, FTA urges the European Commission and UK Government to better coordinate Brexit preparedness efforts. We’re seeing too many uncoordinated actions by member states in isolation – plans based on assumptions rather than proper dialogue or a clear strategy. Authorities need to be allowed to exchange information on the expected location of controls, traffic management and other measures taken to mitigate the impact of border delays in order to minimise disruptions on the flow of goods. 
 
“The European Commission should take the lead in identifying areas where coordinated ‘emergency’ agreements will be a must if the two sides fail to reach a deal. This is especially salient in transport – the logistics industry needs the legal certainty that trucks, planes and trains will be able to circulate without market access restrictions after Brexit, even in the event of a No Deal exit. Unilateral measures – such as those being contemplated in France – are not good enough and fail to reassure our members. Simply saying that alternative forms of transport should be used stems from a fundamental lack of understanding of supply chains and production constraints and does not reflect the fact that massive shifts require huge investment in extra ferry capacity, space and new infrastructure at ports, which are all measures requiring ample time. 
 
Pauline Bastidon concluded: “The UK’s logistics sector is the beating heart of the economy, and one on which most businesses – including manufacturing plants, hospitals and shops – have come to rely. The industry is ready to take action, but it needs clear directions and a supportive environment; above all, it needs time and freedom to adapt to the final outcome.”
 
FTA's sister organisation FTA Ireland has welcomed an extended Brexit transition period and proposes it lasts at least one year, to allow the logistics sector to become more comprehensively prepared for the future trading environment. 
 
Aidan Flynn, FTAI General Manager, said: “There’s growing concern that the inability of Brexit negotiators to reach an agreement will result in a No Deal Brexit – the worst-case scenario. And this uncertainty is leaving the freight distribution and logistics sector in limbo.
 
“At this stage, we should be discussing the length of the Brexit transition period in terms of years, not months. Most importantly, once we hit the start of the transition period – 30 March 2019 – we should know what we are transitioning into. As this is now looking unlikely, the transition period may turn into the new timeframe for the agreement of a future trade deal. It will also serve to encourage a speedier agreement on the future trading relationship, which will be beneficial for Northern Ireland and all island trade.”
 
Aidan Flynn continued: “With the recently announced 4.7% growth in trade in to and out of Dublin Port, the implications of Brexit on future trade flows between Ireland and the UK must not be underestimated, particularly the implications on the just-in-time supply chain. While FTA Ireland welcomes initial preparation made by Dublin Port, most notably the investment in primary border control infrastructure, it is vital that everything is done to ensure we have facilities that will enable ease of movement in to and out of the UK. Dublin Port – like most ports – has spatial issues, and adding additional infrastructure removes space that would otherwise be used for vehicles and this must be kept in mind.
 
“FTA Ireland would like to see a more joined up, strategic plan by Irish ports. This includes Waterford and Rosslare –  these ports should explore sharing capacity to reduce the risk of delays and an over reliance on Dublin. After all, over 90% of all Roll on Roll off traffic between Ireland and the UK is from Dublin Port. 
 
Aidan Flynn concluded: “To become an attractive and viable port, Rosslare needs to introduce border inspection posts and improved facilities as a matter of urgency. In FTA Ireland’s submission to the European Commission’s consultation on amending Regulation 1316/2013, sea trade corridors have called on funding to be made available for Rosslare port, and FTA hopes to see this come to fruition.”