Isolated U.K. Seeks to Reopen Trade Route After Days of Chaos
Isolated U.K. Battles to Reopen Trade Route After Day of Chaos
(Bloomberg) -- British Prime Minister Boris Johnson’s government is desperately trying to re-open trade routes to France after a day of cross-Channel political bartering failed to end the chaos at the U.K.’s busiest port.
France shut down freight traffic from Dover in southeast England at midnight on Sunday because of fear over a faster-spreading mutant strain of Covid-19 that forced the U.K. government to impose a strict lockdown on London and surrounding areas. Spain and Portugal, meanwhile, are among more than 40 countries restricting flights and effectively isolating the U.K.
Johnson said on Monday he’d spoken with French President Emmanuel Macron and Transport Secretary Grant Shapps also held talks with his counterpart, but an agreement expected “within hours” didn’t materialize. At least 1,500 trucks bound for the continent are currently stuck.
“We’re considering everything,” Home Secretary Priti Patel said on Sky News on Tuesday. “We speak to our colleagues constantly in France on a range of issues. We’re working to get a resolution.”
The standoff comes as Brexit talks with the European Union intensify over fish, a politically sensitive issue over which France is playing hard ball. The EU rejected the U.K.’s latest concessions on quotas, two officials said on Tuesday.
Meanwhile, the pressure is mounting to end the turmoil at the border turmoil that is threatening Christmas food supplies during the busy festive period.
Officials are at odds over the type of test to use, two people familiar with the talks said. The French side is pushing for hauliers to take PCR tests, which give a result in between 24 and 48 hours, while the U.K. prefers lateral tests that are less accurate but take only about 15 minutes -and would ease the long line a lot faster Richard Ballantyne, who heads the British Ports Association, is hopeful there could be an exemption for freight drivers that would be combined with testing for Covid-19 at the border.
Brexit Warning
The search for a solution to keep goods flowing in and out of Britain comes after another taxing weekend for the U.K. at the end of a tumultuous year. A spike in coronavirus infections forced Johnson to backtrack on allowing people to spend the festive period together, while talks with the EU on a post-Brexit trade deal entered a critical phase.
The trade upheaval just 10 days before Britain’s post-Brexit transition period is due to end gave the country a foretaste of what could ensue. Without an accord, the U.K. will default to trading with the EU on World Trade Organization terms, with the imposition of costly tariffs and quotas, and the threat of more tailbacks at ports as haulers cope with new bureaucracy.
The economy is already buckling again, with London, the most critical dynamo for growth, in lockdown. Bloomberg Economics revised its outlook on Monday to predict another recession at the start of 2021. The pound plunged against the dollar, marking its worst day since the coronavirus hit markets in March.
Outside Dover, trucks lined up on the M20 highway as an emergency plan was triggered with drivers unable to board ferries. The Department for Transport also prepared to open Manston airport in Kent, which is being overhauled to accommodate as many as 4,000 vehicles as part of Britain’s planning for a no-deal outcome from the EU trade talks.
Johnson sought to downplay the crisis, stressing the closure only applies to “a very small percentage” of food entering the U.K. “The vast majority of food, medicines and other supplies are coming and going as normal,” he said. “The government has been preparing for a long time for exactly this kind of event.”
Vaccine Shipments
The U.K. this month became the first Western country to authorize a coronavirus vaccine. Johnson’s spokesman, Jamie Davies, told reporters that the program would be unaffected because the nation already has the majority of this year’s supply from Pfizer Inc.
Shapps earlier said the border snarl-up only affects about 20% of incoming trade, and that haulers are accustomed to disruption across the Dover-Calais strait because of the weather and strikes.
Nevertheless, the latest challenge is exposing Britain’s trade vulnerabilities just as a 4 1/2-year odyssey to leave the EU moves from political rhetoric to economic reality. Container ports and ferry terminals were already congested because of stockpiling ahead of the Dec. 31 deadline marking a final break from the European single market.
Business groups facing catastrophic losses urged the government to act soon, with the 18,000-member Logistics UK calling for rapid Covid-19 testing of truckers departing the country as the quickest way of protecting supply chains. Meanwhile, there were long queues at some supermarkets in London, with fresh produce fast disappearing from shelves.
French Transport Minister Jean-Baptiste Djebbari said European nations are working on “a solid health protocol” to be implemented “in the coming hours.”
But a meeting of the EU’s crisis response experts in Brussels on Monday ended without a decision on how to proceed, according to an EU official, who spoke on condition of an anonymity. Some members of the group called for an urgent discussion at political level to resolve the issue.
©2020 Bloomberg L.P.