Republic of Ireland – warns UK against using border as Brexit bargaining chip

Irish flag

Following Britain’s recent utterances that it will not rule out the possibility that the EU may retain oversight of customs controls at UK borders after it leaves the bloc, the Irish government has warned UK authorities it will not be used as a “pawn” in Brexit negotiations, reports News Letter, UK.

Foreign Affairs Minister Simon Coveney said he does not want the issue of the Irish border to be used by the UK government as a tool to pressurise the EU for broader trade agreements.

Mr Coveney also said that sufficient progress on the future of the Irish border has not been made during Brexit talks.

Speaking ahead of a meeting with Northern Ireland Secretary of State James Brokenshire in Dublin on Tuesday Mr Coveney said: “We do not want the Irish issue, the border issue, to be used as a pawn to try to pressurise for broader trade agreements.”

He added: “Sufficient progress (on the issues facing the island of Ireland post-Brexit) hasn’t been made to date.”

He warned that in order for Brexit negotiations to move onto the next phase “measurable and real progress” is needed.

Before the meeting Mr Brokenshire insisted there was no possibility of the UK staying within a customs union post Brexit.

He said that to do so would prevent the UK from negotiating international trade deals.However, following a meeting with the Irish and British Chamber of Commerce he said there would be a period of implementation where the UK would adhere closely to the existing customs union.

“We think it is important there is an implementation period where the UK would adhere closely to the existing customs union,” said Mr Brokenshire. “But ultimately it is about the UK being able to negotiate international trade deals.

We want to harness those freedoms. If we were to remain in the customs union that would prevent us from doing so. “We are leaving EU, customs union and single market. We have set out options as to how we can achieve that frictionless trade,” he added.

However, Mr Coveney said the Irish Government believes the best way to progress “the complexity of Britain leaving the European Union is for Britain to remain very close to the single market and effectively to remain part of the customs union.”

He added: “That would certainly make the issues on the island of Ireland an awful lot easier to manage. “But of course the British Government’s stated position is not in agreement with that but that doesn’t mean we won’t continue to advocate for that.

“In the absence of that it is up to the British government to come up with flexible and imaginative solutions to actually try to deal with the specific island of Ireland issues.” Source: Newsletter.co.uk, author Mc Aleese. D, August 22, 2017.

UK’s “New Customs Partnership” – may grant Europe oversight of the Customs border

UK Brexit

Reuters reports that Britain will not rule out the possibility that the EU may retain oversight of customs controls at UK borders after it leaves the bloc, as the country seeks ways to keep unhindered access to EU markets following Brexit.

Last week, the UK published a policy document proposing two possible models for customs arrangements between Britain and the EU after withdrawal from the EU in 2019.

The first model was a “highly streamlined customs arrangement”, which involved the reintroduction of a customs border but which envisaged electronic tracking of shipments, rather than physical checks of goods and documents at the border.

An alternative proposal was the “new customs partnership”, which would remove the need for a customs border between the UK and EU altogether.

Under this model, the UK would operate as if it was still part of the bloc for customs purposes. British goods would be exported tariff-free and Britain would levy EU tariffs on goods coming into the UK for onward passage to the EU directly or as components in UK exports.

Lawyers said there would be a need for a mechanism to oversee the “new customs partnership” to ensure that the UK was correctly monitoring goods coming into the UK and destined for Europe.

The EU’s system of movement of goods across EU borders without checks works on the basis all members closely monitor shipments coming into the bloc from outside, to ensure the correct tariffs are paid and that goods meet EU standards.

The antifraud agency of the EU polices customs agencies across Europe to ensure that they are correctly monitoring imports. Source: Reuters, Bergin T, August 21, 2017

7,500km Marathon Journey for Chinese Silk Road train

The UK’s Daily Mail  reports the arrival of a freight train in east London has marked a new era for the 2,000-year-old trading route. It is the first freight train service from China to the UK. The route known as the ‘Silk Road’ once helped bring a wealth of goods from China to Europe.

The train pulled in to Barking after an 18-day journey from Yiwu, a wholesale market town in the eastern Chinese province of Zhejiang. It had passed through Kazakhstan, Russia, Belarus, Poland, Germany, Belgium and France, finally crossing under the English Channel into Britain.

Laden with 68 twenty-foot equivalent containers, the train brought in a cargo of small commodities including household items, clothes, fabrics, bags, and suitcases.

The Silk Road Economic Belt and the 21st-century Maritime Silk Road, also known as The Belt and Road (abbreviated B&R), One Belt, One Road (abbreviated OBOR) or the Belt and Road Initiative is a development strategy and framework, proposed by Chinese paramount leader Xi Jinping that focuses on connectivity and cooperation among countries primarily between the People’s Republic of China and the rest of Eurasia, which consists of two main components, the land-based “Silk Road Economic Belt” (SREB) and oceangoing “Maritime Silk Road” (MSR). The strategy underlines China’s push to take a bigger role in global affairs, and its need for priority capacity cooperation in areas such as steel manufacturing. Wikipedia.

Ten containers were taken off at the German hub of Duisburg. The remainder arrived in London at Barking’s Eurohub freight terminal. The service is faster than sending goods by sea. Weekly trains will initially be run to assess demand.

A number of different locomotives and wagons were used as the former Soviet Union states have a larger rail gauge than the other countries involved. China Railway already has freight services to a number of European destinations, including Hamburg and Madrid.

They are part of China’s One Belt, One Road programme of reviving the ancient Silk Road trading routes to the West, initially created more than 2,000 years ago.

Run by Yiwu Timex Industrial Investment, the Yiwu-London freight service makes London the 15th European city to have a direct rail link with China after the 2013 unveiling of the ‘One Belt, One Road’ initiative by Chinese premier Xi Jinping.

UK Prime Minister Theresa May  said the relationship with China remains ‘golden’ as she seeks to bring in billions of dollars in Chinese investment as Britain prepares to leave the European Union. Read the full original Daily Mail article here!

UK drops VGM accuracy requirement

MCA LogoThe UK Maritime and Coastguard Agency has dropped the tolerances it was considering for weighing equipment used to weigh a container for the new SOLAS VGM requirement.

One of the issues that has been holding some terminals back from investing in equipment to weigh containers is the lack of any clarity over the accuracy standards that equipment must meet. SOLAS says only that equipment must “meet the applicable accuracy standards and requirements of the State in which the equipment is being used”.

The UK Maritime and Coastguard Agency (MCA) had been consulting on a proposal for two weighing tolerances for equipment used to generate a Verified Gross Mass (VGM) using method 1 (weighing the container):

  • +/- 400kg up to 20T then +/- 2%
  • +/- 300kg up to 15T then +/- 2%

Sources involved in the process say some port operators and weighing equipment suppliers had expressed concerns these tolerances were unreasonable. MCA has this week issued new guidance on the VGM requirement, including a procedure for applying for approval to use Method 2 (weighing cargo items and calculating the total weight of a container).

The MCA has dropped any requirement for a specific accuracy level, opting instead to set an enforcement level. It stated: “The verified gross mass should be as accurate as reasonably practical taking into account methodology and operational variances. The MCA has set an enforcement tolerance of ±5% or ±500kg, whichever is the greater value to avoid disruption within the supply chain, however this value is for enforcer’s guidance only and it is the shipper’s responsibility to be as accurate as possible”.

Method 1 equipment includes “weighbridges, or lifting equipment fitted with load cells, or other approved weighing equipment to determine a loaded container’s Verified Gross Mass (VGM)”. Unlike other jurisdictions the MCA has not stated that it requires two 20ft containers on a trailer to be weighed separately, or said anything about how the weight of the truck and trailer is to be obtained. It stated only that “Calculations may be used as part of the method 1 process”, so these items do not in fact need to be weighed as part of the VGM process.

With regard to certification and enforcement, the MCA states: “ Method 1 users are required, on request by the MCA or other body, to provide both of the following:

  • Evidence that the weighing equipment has been supplied/maintained for the purpose of determining the VGM of a loaded container and is capable of producing a ticket (electronic record). Each ticket must include the container number, the VGM of the container, and the procedures for, and records of, any calculations which have been made. If this information is produced as an electronic record, it is essential that it is able to be produced without delay as a paper document.
  • Records kept of maintenance and verification (calibration) procedures, including any corrective / remedial actions taken.

The full guidance and other documentation can be found at this link. Source: WorldCargoNews

India to Become World’s Largest Infrastructure Goods Importer by 2030

HSBCAccording to the recently released HSBC Trade Forecast Report, by 2020 India is expected to surge past the United States as the world’s biggest importer of infrastructure goods – a position it is expected to hold until at least 2030. This is a result of the country’s increased demand for materials for infrastructure projects (i.e., metals, minerals, buildings and transport equipment) as it invests more in the building of its civil infrastructure.

The report, which focuses primarily on infrastructure, notes that as Asian economies grow they will take an increasing share of infrastructure-related imports over the next two decades. Currently, the U.S. tops the list of countries importing infrastructure goods, followed by India, Hong Kong, China and Germany. By 2030, India will sit up the top of this list, followed by the U.S., China, Hong Kong and Korea.

Sandeep Uppal, HSBC India Managing Director and Head of Commercial Banking, noted that the “rising middle classes across Asia’s rapidly emerging markets, especially in India and China, will drive significant infrastructure demand in the region.”

“Aspirations of the new middle class and rapid urbanization will force India to upgrade its civil infrastructure, thus pushing up demand for overseas infrastructure related goods,” she added.

To continue with the rising trends, the report further states that Asia as a whole is predicted to see the most rapid growth in merchandise trade between 2020-2030 – led by India, China and Vietnam – at estimated annual export growth rates of more than 10 percent.

For comparison, the export rates of European countries, such as the UK, France and Germany, are forecasted to grow at about 4-5 percent annually on average over this 10-year period. Meanwhile, average export growth in the U.S. is estimated to top off at around 6 percent annually during the same period.

What this means is that by 2030 infrastructure-related goods will be the most commonly traded type of goods, increasing in market share from the current rate of 45 percent of total goods exported to upwards of 54 percent. Source: India Briefing

Foreign truckers will pay to use roads

Dare say the following will not go unnoticed by South African authorities. The bottom line in all of this is the question of effective enforcement.

News that the government intends to go ahead with plans to introduce a charging system for foreign truckers using UK roads has got the thumbs-up from the Road Haulage Association (RHA). “This is a happy day for road hauliers”, said RHA Chief Executive Geoff Dunning. “We have been campaigning for years to see a system introduced which will lessen the financial advantage currently enjoyed by our European neighbours.”

Foreign truck drivers will have to pay £10 a day to use British roads by 2015, under the new legislation. British truckers are used to paying special road charges of up to £13 a day on the continent, but their European counterparts pay nothing when they drive in the UK.

Announcing the plan, New Transport Secretary Patrick McLoughlin said: “These proposals will deliver a vital shot in the arm to the UK haulage industry. “It is simply not right that foreign lorries do not pay to use our roads, when our trucks invariably have to fork out when travelling to the continent.” It is estimated that 1.5m visits are made by foreign hauliers to the UK every year.

The new charge is expected to cost most drivers £1,000 a year. Dunning added: “This is not enough to give us a level playing field as regards the rest of Europe. But it is a good start and will help no end in beginning to prepare the ground.

“We are pleased that Mr McLoughlin has seen fit to bring forward this legislation so early in his tenure as Transport Minister; he is obviously very aware as to the important role played by UK hauliers in rebuilding the economy, increasing UK competitiveness and boosting growth.”

UK drivers will also have to pay the daily charge because of European laws, but it will be offset by a corresponding road tax cut. A bill setting out the plan will be published next month, with ministers expecting the new system to be introduced within the next two years. Source: Lloyds List