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U.K. Government Grapples with Post Brexit Tariffs


With the imminent departure from the E.U., industry and agricultural groups in the U.K. are clamoring for imposition of tariffs to protect local production.

Michael Gove, the Environmental Secretary has pledged to apply tariffs on food imports to protect U.K. farmers. Responding to an appeal by the National Farmers Union (equivalent to the U.S. Farm Bureau Federation) he stated, "Your concerns have absolutely been heard and it will not be the case that we will have zero-rate tariffs on food products." Across the industrial spectrum, manufacturers are concerned over tariff-free imports from from China.

During February, Honda announced that it would close it sole U.K. manufacturing assembly plant resulting in extensive job losses. The action by this Japanese manufacturer is the first in an anticipated stream of declarations by multinational companies concerned over their U.K. plants becoming noncompetitive in the EU due to tariffs.

There is now a realization that the U.K. is not going to receive preferential treatment from the EU and further negotiations will not soften the blow to the economy of the nation. Voters who narrowly passed the referendum in 2017 are now becoming aware of the implications of Brexit and that pre-election rhetoric understated the detrimental effects of a withdrawal. The Labor Party in opposition to the Conservative-led coalition in Parliament has recently hinted at a second referendum to reconsider leaving the EU.