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A well researched piece from the Sunday Telegraph.
In nine months, Britain will leave the EU and, if we leave the single market and customs union, the rules governing roughly half of our $750 billion trading network will change entirely. Major corporations, like Airbus and Honda, which rely on timely supply chains spanning the English Channel, warn that this would be a catastrophe. Pro-Brexit politicians claim these companies are overreacting, because the technology that already smooths the journey of non-European goods, like those Ethiopian roses, can easily be repurposed to manage EU trade. A journey through Britain’s trading system reveals the truth. The Brexiteer case isn’t “magical thinking”, as some in Brussels might claim, but nor is it simple and easy. The technology necessary to create the system they envision is already in the works and our ports have experience implementing such changes. But there’s a catch.
The systems required will take several years to develop and no one can invest a penny until the Government stops squabbling and decides what it wants. In Felixstowe and Southampton, home to two of Britain largest ports, cargo ships from far and wide come and go. At Felixstowe, I saw the CSCL Pacific Ocean dock, bearing 10,000 forty-foot containers. It weighs 360,000 tonnes and stretches 58 metres tall and 400 long. Yet, within fifteen minutes, before they are even offloaded, nearly all of the containers on it will be electronically cleared through customs and ready for pickup, using a software made by the British firm, MCP. In Southampton, it’s the same story. “On arrival, 95pc are good to go,” said Nick Loader, chief executive of DP World, the container port operator. He uses similar software made by CSNI. Software like this has vastly increased Britain’s trading efficiency. They act as electronic hubs connecting each link in the chain, from manufacturer to shipping line to freight forwarder to port operator to government agencies, so that data and notifications can ping back and forth instantly. “It’s pretty nifty,” said Matthew Bradley, chief execDublin or Dover to Calais, by contrast, are too short. And in the case of Eurotunnel, lorries legally pass from the UK “into France”, and vice versa, within minutes at border posts inside the terminal. There is another problem, too. Although the vast majority of non-EU goods are cleared before their owners even want them, some goods can be held up for several days. In Southampton, I saw why.
Patricia Gonzalez, a vet at the Port Health Authority, carries out customs checks. Above a crowded desk, her neat handwriting has filled several large whiteboards with lists of EU trade regulations. They specify the percentage rate at which thousands of products need to be inspected: Chinese tea, India spices, Vietnamese dragonfruit, Nigerian watermelons, Egyptian peanut butter, Serbian raspberries, and so on. There’s a column for the risks, too, like norovirus, pesticide residues or salmonella. Brexiteers like Jacob Rees-Mogg argue that such systems can work for EU goods. But a visit to the cargo operations of Eurotunnel in Folkestone tells another story.
The terminal sits huddled between the M20 and the rolling green slopes of the Kent Downs. On its ten platforms, up to 250 lorries an hour trundle onto trains, servicing immensely complex supply chains. Together, Eurotunnel and Dover handle £171 billion of UK-EU trade per year, over a quarter of Britain’s total. And there’s an important difference between this cargo and the containers at Southampton and Felixstowe: it travels on lorries. It’s called “roll-on, roll-off” trade. It rolls onto ferries or trains and rolls off onto motorways in another country, all within 90 minutes. It is this time cap that poses the problem, making EU trade “much more difficult”, according to Alan Long, chief executive of MCP.
Currently, it takes at least four hours from the moment a shipment’s paperwork is submitted until it can get the all-clear. In that time, the shipping line submits a “manifest”, a document about the goods, the freight forwarding company fills in a separate customs form, and all the data is sent to various government agencies, which examine it and issue a decision – all clear or hold for inspection. The software transmits the information automatically, but the data collection and decisions take time. Non-EU trade spends days or weeks at sea – ample time for the process. Trips from Holyhead to Dublin or Dover to Calais, by contrast, are too short. And in the case of Eurotunnel, lorries legally pass from the UK “into France”, and vice versa, within minutes at border posts inside the terminal. There is another problem, too. Although the vast majority of non-EU goods are cleared before their owners even want them, some goods can be held up for several days.