Ruling out highest tariffs necessary
to stop 'choking off investment,' says Confederation of British Industry chief
Business leaders have demanded Prime Minister Theresa
May move to rule out the "worst aspects" of a hard Brexit break with the EU.
Confederation of British Industry (CBI) director general Carolyn Fairbairn said it was a
matter of urgency because uncertainty was impacting on investment decisions.
Ms Fairbairn warned it was crucial for ministers to
state that Britain would not be reduced to the basic tariff arrangements set
down by the World Trade Organisation (WTO) when it is expected
to exit the EU in 2019, and that the "passporting" system allowing
easy access for service industries would stay in place.
"What we would like is the ruling out of the
really worst options. The falling into WTO rules in only 29 months from now,
which is the prospective timetable, would mean up to 90% of goods could
potentially have tariffs on them. There would not be the passports for our
service industry.
"What is important here is to rule out some of
these really negative options. To be choking off investment now, to be
affecting investment now, is a really important thing.
"The urgency is around investment. It is the
investment decisions that are being taken now that make this urgent," she
told BBC Radio Four's Today programme.
Ms Fairbairn said some of the messages coming out of
last week's Tory conference were not helpful for business.
The remarks come after business leaders with the CBI
and manufacturing body the EEF signed an open letter warning of the dangers of
a hard Brexit as they urged the Government to "give certainty" on the
issue.
The letter said: "We respect the result of the
referendum, but the Government must make sure that the terms of the deal to
leave ensure stability, prosperity and improved living standards.
"Every credible study that has been conducted has
shown that the WTO option would do serious and lasting damage to the UK economy
and those of our trading partners."
The letter also questioned whether negotiations could
be completed in the two-year framework envisaged.
"Many areas of regulation now up for discussion
are highly complicated. The Government should therefore secure agreement of a
transitional period, to ensure that businesses can continue to operate with no
'cliff edge' change to current circumstances until regulatory and legal changes
can be implemented."
Mrs May has said she will formally trigger the
two-year exit negotiations by the end of March.
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