EU Customs Union — House of Commons, 2016-11-02
Topic: Foreign Trade
Helen Catherine Goodman (Labour, Centre-left): We need to explore that and think about it in a little more detail A leaked document from the Treasury found that were we to leave the customs union, our GDP would fall by some 4.5%. Of course, I am not asking the Minister to comment on a leaked document, but it would be very nice if he could say how many jobs a fall of 4.5% of our GDP would translate into us losing. I think it would be hundreds of thousands It is true that staying in the customs union limits our capacity to do new trade deals on the goods it covers with third countries such as India and Australia. Some of the hard Brexiteers, such as the Secretary of State for International Trade and President of the Board of Trade, the right hon. Member for North Somerset (Dr Fox), seem to think that this is a good thing. He made a speech in Manchester in which he hailed the "post-geography trading world". Well I have heard of the end of history, but I have never before heard of the end of geography. I think he is being wildly over-optimistic. As the Chancellor of the Exchequer pointed out to the Treasury Committee, world growth and growth in trade are both slowing. This is not a good background in which to initiate these deals. The Government’s export target of £1 billion is bumping along at half that level and there would be a time lag. We cannot start the negotiations at least until our relationship with Europe is clear. That is obviously going to take three or four years, so we need to have transitional arrangements Finally, there must be a big question mark over whether we can get deals with third countries that are so much better that they more than compensate for what we would lose if we left the customs union. The UK is one tenth of the EU market of 550 million people. The Americans have already told us we would be at the back of the queue. The Swiss have found, in negotiations with the Chinese, that the Chinese get access to the Swiss market seven years before it gets access to the Chinese market. Ministers are at sixes and sevens on this, with the Treasury and the Department for Business, Energy and Industrial Strategy apparently on one side, and the Department for International Trade and the Foreign and Commonwealth Office on the other. Robert Peston has pointed out that the mere fact that the Department for International Trade exists makes it a fiduciary obligation for multinational manufacturers based in Britain to start thinking about moving investment and jobs to the rest of the European Union. I will not talk about the Irish dimension, because I have already taken interventions on it, but it does present a significant political problem What I am mainly saying to the Minister this evening is that millions of jobs depend on our staying in the customs union. I am sure that the Secretary of State for International Trade is delighted that his career is flourishing and that he is travelling around the world, meeting all sorts of interesting people and trying to do lots of deals, but those million manufacturing jobs matter more than his grandiloquent ideas. What we want from the Minister is some concrete evidence that decisions will be taken on a proper basis. My message is simple: a bird in the hand is worth two in the bush.