While breaking from EU regulation could provide opportunities for major East Anglian industries, the costs will “vastly outweigh” the benefits, a new report claims.
The Confederation of British Industry (CBI) has spent six months exploring where British businesses want to stay close to EU rules and where they want to break away, covering 23 sectors from finance and technology to construction.
Its resulting Smooth Operations report says that, while there are opportunities for divergence in industries like agriculture and tourism – lynchpins of the East Anglian economy – these are outweighed by the costs of deviating from rules necessary to ensure smooth access to the EU, the UK’s most important trading partner.
For the agri-food and drink sector, the report found deviating from EU rules could give scope to make positive changes including to domestic agricultural policy.
But close regulatory alignment with the bloc in food production, transportation and labelling would be needed to avoid “major barriers” to trade and competition.
In hospitality and tourism the report said convergence – where the UK and EU are governed by the same rules – was the “main priority” in most areas including a liberal visa regime, the functioning of airports and data sharing.
However, it said divergence from EU rules could help in “specific areas”, for example through measures to boost UK domestic tourism.
In the creative industries and life sciences, listed in the report as strong sectors for East Anglia, the CBI recommended full convergence, particularly in the production and sale of medicines and medical devices.
The report added that businesses were not looking for a “bonfire of regulation” and that EU rules were “generally perceived” as good.
Richard Tunnicliffe, East of England regional director for the CBI, said most businesses in the East of England’s major sectors had indicated a desire to stay close to the EU.
“The East of England relies heavily on trade with the EU and there are European companies working here, so it is really important that the UK gets this right,” he said.
“Businesses will work closely with government here and with counterparts in Europe to ensure they hear what is important for our companies.”
Story and image from the Eastern Daily Press