EU Customs Union

Part of Petition - Tenancy of ST Michael’S Gate, Parnwell – in the House of Commons at 7:30 pm on 2nd November 2016.

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Photo of Robin Walker Robin Walker The Parliamentary Under-Secretary of State for Exiting the European Union 7:30 pm, 2nd November 2016

That is a fair point. I shall say something about our engagement with some of those industries and the importance of supply chains later in my speech. It is worth noting, however, that many countries also have authorised economic operator schemes, which means that exporters with supply chains that are demonstrably secure are subject to fewer and less stringent checks. The EU has such arrangements with China, Japan, Norway, Switzerland and the United States, through which both sides recognise each other’s authorised economic operators for customs purposes.

Turkey, which the hon. Lady mentioned, is one country outside the EU that has a customs union arrangement with it. That arrangement covers most but not all goods. Raw agricultural produce, for instance, is excluded. The EU and Turkey have been preparing to update the terms of their current customs union arrangements, which were always meant to be transitional, given that Turkey has applied to be a full member of the EU. I could go on, as there is a multiplicity of examples, but the point is that any decision about membership or otherwise is complex, and must take account of the full spectrum of options.

During last week’s debate, the Prime Minister also said that the way in which one dealt with the customs union did not involve a binary choice. There are different aspects to a customs union, which is precisely why it is important to look at the detail, to carry out the hard analysis that the hon. Lady called for, and to get the answer right. We have made it clear that we will pursue what works for the unique circumstances of the United Kingdom, and we continue to analyse thoroughly what it might look like in order to ensure that we make the best choice for the UK. That includes the broad-based analysis of more than 50 sectors that my Department is undertaking in relation to the impact of the UK’s leaving the EU.

As with the broader UK-EU negotiations, we recognise the need for a smooth transition that minimises disruption to our trading relationships and seizes the opportunities that are presented. The issue of a customs union has also been part of the Government’s programme of stakeholder engagement. We have been discussing this matter with numerous companies, organisations and trade bodies, including the chemicals sector, car manufacturers, and the agriculture and food and drink sector. We want to ensure that their views are reflected in our approach. The Prime Minister has been very clear that the intention of the Government is to ensure a competitive market so that people are able to prosper here in the United Kingdom and add to our economic growth.

We are also aware of the specific circumstances faced by businesses in Northern Ireland, which I know the hon. Lady could have touched on if she had not taken the interventions. We had a common travel area between the UK and the Republic of Ireland many years before either country was a member of the European Union. Nobody wants to return to the borders of the past. I underline the will and commitment of ourselves, the Irish Government and the Northern Ireland Executive to support the common travel area and to ensure that there are no hard borders. We must now work closely together to ensure that as the UK leaves the EU we find shared solutions to the challenges and maximise the opportunities for both the UK and the Republic of Ireland, which I expect will continue to be a close friend of the UK in years to come.