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Kent firms' concerns about prospect of no-deal in Brexit negotiations

By Chris Price

As ministers wave the threat of no deal over Brexit at their European counterparts, firms in Kent are sweating about the prospect of no trade agreement being in place at the end of the negotiations.

Tim Allen claims his metal castings business has not enjoyed the Brexit bounce.

Many manufacturers in the county hailed the devaluation of the pound following the EU referendum last year as it made their goods cheaper for foreign buyers.

Yet Mr Allen’s company MJ Allen, which employs about 260 people, is being held back as businesses on the other side of the Channel watch closely as the negotiations in Brussels unfold.

It is hoped a lorry park would mean Operation Stack could become a thing of the past
It is hoped a lorry park would mean Operation Stack could become a thing of the past

“New projects in our industry take a long time to come to fruition,” said Mr Allen, whose business is at Cobbs Wood Industrial Estate in Ashford.

“European customers are wary of entering new long-term supply arrangements until there is clarity as to how the UK will be able to trade.

“We have not seen new work directly from Europe despite the pound’s devaluation.

"The downside is that the cost of our raw materials has gone up, with more increases in the pipeline putting pressure on margins. Passing on those increased prices to our customers is very difficult.”

MJ Allen managing director Tim Allen
MJ Allen managing director Tim Allen

Although existing projects appear unaffected, Mr Allen is concerned about the heightened focus on the possibility of there being no Brexit deal by the time the talks are due to finish in March 2019.

Last month, Dover MP Charlie Elphicke, who was recently suspended by the Conservative Party, urged the Chancellor to set aside £1bn in his upcoming Budget on November 22 to pay for securing the borders and improving transport links in the event of no deal.

Meanwhile, Folkestone and Hythe MP Damian Collins urged the government to reach a settlement with residents and businesses who live near the planned site of a huge lorry park off the M20 to get the site built as quickly as possible.

Without it, he said Operation Stack, where lorries are parked on the M20 if there are difficulties crossing the Channel, might become “a frequent and unwelcome visitor”.

Deal and Dover MP Charlie Elphicke
Deal and Dover MP Charlie Elphicke

Mr Allen said: “I am worried that trade tariffs could make us less competitive but more worried about border bureaucracy and logistic hold ups making it difficult moving goods across borders.

"If we make buying and moving goods too difficult customers will move elsewhere.”

His concerns were echoed by the haulage campaign group the Freight Transport Association, based in Tunbridge Wells, which is desperate to avoid the imposition of greater checks at places like the Port of Dover in the event of no deal.

Deputy chief executive James Hookham said: “This would mean new paperwork being inspected and new checks needing to be conducted at the Port of Dover or Channel Tunnel terminal.

"These could severely delay the off-loading of trucks from the ferries and the shuttle trains.”

The government has reiterated its commitment to the M20 lorry park. Picture: Highways England
The government has reiterated its commitment to the M20 lorry park. Picture: Highways England

The Port of Dover estimates for every two-minute delay in checking lorries, a queue of 17 miles will form on the M20, reaching back to Ashford.

“Operation Stack could become a weekly occurrence,” added Mr Hookham.

“Walking out might be politically satisfying but it would throw trade with the EU into utter confusion.”

Alison Parmar, development manager at the Federation of Small Businesses’ branch in Kent, said the solution wanted by her members is “to have the certainty that there will be a Brexit transition period” after the UK formally leaves the EU in 2019.

She said: “With many firms looking to future investment decisions, it is vital that a ‘standstill’ implementation period is agreed urgently.

“The longer the short-term uncertainty goes on, the more difficult it will become for small businesses with EU customers or supply chains to make investment decisions.”

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