Brexit: Business leaders urge next government to take time to strike beneficial deal

Boris Johnson wants the agreement inked within a tight 11-month deadline

Related video: Michael Gove reveals Brexit trade talks likely to be shelved (AFP/Getty)

Business believes it is more important for the government to get the UK’s post-Brexit trade relationship with the EU right than to get a deal done quickly, according to a new survey.

The findings emerged as the Institute of Directors issued a plea to whichever party wins next week’s general election for clarity on its negotiating objectives for what the group said would be “choppy trade waters” in the period after the planned Brexit date of 31 January.

Crucially, the group said the incoming administration should review the new Digital Services Tax due to be imposed on tech firms from April, in the wake of US threats of retaliatory tariffs in response to a similar levy in France.

Mr Johnson has set a hard deadline of 31 December 2020 in the Conservative manifesto for the completion of talks on the UK’s future trade relationship with the EU, reviving fears of a no-deal departure under unfavourable World Trade Organisation terms.

The 11-month timetable is significantly shorter than usually required for comparable free trade agreements (FTAs) and senior EU negotiator Sabine Weyand has said it will not be possible to achieve anything more than a “bare bones” deal by the deadline.

In a poll of more than 1,000 business leaders for the IoD, more than half (55 per cent) said that their priority for any negotiations with the EU following the 31 January date of Brexit was “the terms and content of the final deal”.

By comparison, fewer than one-third (31 per cent) said the most important issue was “how long it takes for these negotiations to conclude”.

Mr Johnson insists it will be possible to conclude an ambitious FTA by the December deadline, but has declined to say whether he would advise businesses to cease preparations for a possible no-deal crash-out at the end of 2020.

The IoD said that any government taking office next week should commit to publishing negotiating objectives well in advance of all new trade talks.

And it said companies must be given a sufficient adjustment period before any new relationship with the EU comes into effect.

The IoD’s head of Europe and trade policy Allie Renison said: “While it’s impossible to know at this point how Brexit will turn out, business needs a number of commitments from the next government to help navigate its way through choppy trade waters ahead.

“Understanding the exact nature of how arrangements with the EU may change is critical for companies, and our data clearly shows that getting a workable deal after Brexit is more important to business leaders than simply how long it takes to get there.

“We’ve had heard much talk of the idea of ‘global Britain’, with little focus so far on the concrete, bread-and-butter issues that are needed to deliver the UK’s international ambitions. The ideas we lay out aim to bring the discussion back to basics of what business needs to safeguard and expand their international footprint – with the EU and beyond.”

The IoD surveyed 1,008 business leaders between 19 and 29 November.