Westminster Diary - Our Future Economic Partnership with Europe

Over recent days the Government has set out our ambitious vision for a future economic partnership with Europe after leave the European Union and on Friday the Prime Minister, Theresa May set out a number of key tests for this new relationship.

As we leave the European Union it is vital that we respect the result of the 2016 referendum, but it is important that we also protect jobs and security here in the UK. As the Prime Minister said on Friday, the existing models for co-operation between the EU and an outside nation do not meet the standards needed to safeguard jobs and growth both here and in the EU. As such, we will rightly seek the broadest and deepest possible agreement – covering more sectors and co-operating more fully than any Free Trade Agreement anywhere in the world today. I am encouraged that the Government remains committed to the UK being a champion of free trade and high standards, looking to build new trading relationships not only with the EU but with our friends and allies right across the world.

It is also important that the Prime Minister has said that all of us, irrespective of our view on the referendum, will need to face up to some hard facts on our future relationship. In continuing to trade with Europe, we will need to accept that in this negotiation neither side we get exactly what they want and in order to secure access to each other’s markets, both the UK and the EU will need to agree to co-operate on issues of regulation, particularly on integrated supply chains which have been vital to the success of industry both here and in Europe.

The importance of a close future relationship with the EU for such businesses has been spelled out explicitly by the Business, Energy and Industrial Strategy Select Committee, of which I am a member. The Committee has been examining the potential impact of Brexit on some of our key industries and last Thursday we published our report on The impact of Brexit on the automotive sector. As part of this inquiry we heard evidence from key players in the industry about their concerns and our findings make it clear that in order for our automotive industry to continue to thrive after Brexit, we need to ensure that we have the closest possible regulatory alignment with Europe for goods so that the border is as frictionless as possible.

This is important for Rugby as the resurgence in the automotive industry we have seen over recent years in the West Midlands is a real success story for our area. We have seen investment by Jaguar Land Rover on our doorstep in Coventry alongside the construction of the London Electric Vehicle Company’s new factory at Ansty in the constituency. The good news last week that Toyota will be building the next generation of Auris hatchbacks is a welcome reminder of the strength of our economy, but also underlines the importance that the final deal we negotiate with the EU must encourage other companies to follow Toyota’s lead and invest in Britain.