Yesterday’s EU-UK summit yielded a deal that commits both parties to greater cooperation on defence, energy and Sanitary and Phytosanitary (SPS) controls, marking a meaningful shift in post-Brexit relations between the two.
Amid the noise, the Daily Update heard from a number of trade experts to understand what the deal could mean for the future of the relationship and UK traders.
William Barns-Graham, executive editor at the Chartered Institute
Ahead of the UK-EU summit, the media and policy world were largely predicting that there would be announcements on defence, youth mobility and some sort of commitment towards reducing SPS controls.
This forecast was largely correct, though there was probably more government fanfare on SPS than anticipated and more headlines on fishing. This may speak to the trade-offs governments need to make in negotiating international relations.
The Labour government will be hoping that the benefits of reducing SPS trade barriers will outweigh the grievances currently being expressed by sections of the fishing community, as well as its political opponents in Westminster. Given the impact we know Brexit has had on food and drink trade with the EU, you can see the logic behind this, and reducing complexity and documentary requirements will be welcomed by many, including a lot of our members.
As noted by policy experts in a preview event on LinkedIn that I hosted last week, this summit is the first of many, and there is a lot of work that needs to be done to finalise the details and then implement yesterday’s announcement. The increased cordiality at the political level, though, marks an important change in tone for the future of the relationship.
Joseph Goldsworthy, SPS expert at the Chartered Institute
Yesterday, the UK government announced a new deal with the European Union on SPS controls. This is really encouraging news for the food and drinks sector, amongst other industries.
Since Brexit, traders have had to get health certifications for many animal products. This process was complicated, needing official veterinarians to sign off and making it tough for many businesses to export their goods to the EU and vice versa.
Sectors such as processed meat and dairy have found the transition since leaving the European Union particularly difficult, with certification difficult to navigate and slow clearance times leading to consignments being turned away or destroyed. With today's announcement, both parties will work towards a common SPS area. The expectation will be that checks are significantly reduced, and red tape slashed.
Traders on both sides of the border will be keen to get further details on the developments of this proposed common SPS area. These announcements are very welcome in an industry which has seen exports stagnate, and hopeful that further details on the framework of the new SPS agreement are released in good time, giving traders time to prepare.
Alessandro Wagner, customs compliance manager at a large UK food producer
This new commitment to an UK-EU sanitary and phytosanitary (SPS) agreement is a truly welcome development for the food industry. For too long, businesses exporting products containing animal origin materials from the UK to the EU have faced significant hurdles due to extensive health checks and burdensome red tape at the EU border. This has drastically impacted our ability to trade efficiently with our closest market.
The removal of a vast majority of these routine checks and the simplification of processes will be a game-changer. It directly addresses the friction that has hindered exports since Brexit. This agreement promises to restore a more seamless flow of goods, making British food products containing animal origin materials more competitive and accessible in the EU. It's a vital step towards unlocking growth and providing much-needed certainty for producers and exporters across the UK.
Dr Peter Holmes, fellow, UK Trade Policy Observatory, and adviser to Independent Economics
Today’s UK-EU agreement is an agenda for future negotiations, not a legal agreement. While this deal won’t transform our trade and growth, it could be an important first step. Even as it stands it’s worth more than any of the Free Trade Agreements (FTA) the UK has signed.
An extension of the original Trade and Cooperation Agreement, the fisheries deal had been an essential political condition from the EU side. Despite the backlash, much of the fisheries industry will actually gain if the SPS deal delivers easier access for UK fish to the EU market.
Youth Mobility was also a condition for the EU. Full details remain to be settled but, if done well, this could help UK universities.
The proposed “common SPS area” will greatly help GB-NI trade; preventing alignment with US food safety rules is a “price” worth paying!
The biggest benefit of the agreement is probably the commitment to negotiate alignment with the EU Emissions Trading Scheme (ETS) and the avoidance of Carbon Border Adjustment Mechanism (CBAM) charges and paperwork.
Apart from services, the biggest gap is that there is nothing about Mutual Recognition of non SPS conformity assessment. Probably inevitable because the UK has no choice but to accept CE marks.
The commitment to regulatory and judicial cooperation is also likely to bring important, if unquantifiable, gains.
Grace Thompson, UK public affairs lead at the Chartered Institute
In opposition, Labour first spoke of its ambitions to secure an SPS agreement with the EU, which they have now accomplished. However, having entered government during a time when President Trump has changed the name of the game in relation to the global trading landscape, and with wars rumbling on, the ambitions around the UK-EU package have developed. A values-based stance has been taken. The joint statement yesterday confirmed “shared principles of maintaining global economic stability” and “mutual commitment to free, sustainable, fair and open trade, in line with our shared values”.
Equally paramount has been the importance of safeguarding supply chain resilience, with the dangers of over-dependence on a country or bloc recently highlighted starkly. Reacting to this, the International Trade & Investment All-Party Parliamentary Group (APPG) has put out a call for evidence on future-proofing supply chains and industries. Indeed, the government has acted three times to protect the UK’s steel industry in recent weeks – the Steel Industry Act, the removal of steel tariffs via the UK-US Economic Prosperity Deal, and now agreeing with the European Commission that they will restore the UK’s country-specific steel quota to historic levels, which will be reflected in a post-2026 regime.
Member exclusive
