MBB welcomes Brexit agreement: ‘We are confident companies have made necessary preparations’

The Malta Business Bureau welcomed the news of an EU UK Free Trade Agreement, one week before the end of the transition period, which provides much legal certainty and more beneficial conditions in a wide range of important commercial areas of our relationship with the UK, despite many changes will come to effect that will nonetheless bring substantial challenges to implementation.

In a press statement featured on the MBB’s website, the organisation’s president, Simon De Cesare, commented:

“We are relieved this long process that has created much uncertainty over the last four years is nearing its end. An agreement is what we repeatedly called for, and we are very pleased that now there is one to mitigate the strong impact there would have been otherwise. Nevertheless, companies engaging in commercial activity with the UK will still experience changes, as the conditions of a free trade agreement are nowhere close to operating in a single market.

“We are confident that thanks to the information and advisory services that have been made available, companies have made the necessary preparations for this transition. However, there will still be a learning curve, both for companies as well as public authorities, once a new system comes into effect, and for this, we call on all parties to show more flexibility and understanding while ensuring compliance to the new rules,” Mr De Cesare continued.

On the agreement in general, while still having to go through the finer details, the MBB welcomes the fact that goods between the two blocs can continue to be traded free of tariffs and quotas, while meeting rules of origin criteria. Also, considering the substantial volume of agricultural and products of animal origin imports from the UK to Malta, it is positive that the EU already confirms that the UK meets the necessary standards to export such products to the EU.

Also, positive for Malta is the confirmation that all means of transport will continue to take place uninterrupted, with short term visitors not requiring a visa, the MBB noted. There are also commitments on the safeguarding of passenger rights.

The wider impact in the area of services needs further understanding, particularly as the EU and UK have only issued declarations for the purpose of the agreement, but negotiations will continue in specific areas such as financial services and free movement of data in the coming months.

Meanwhile, challenges are expected in the recognition of professional qualifications where there is no specific arrangement outlined other than a commitment for regulators on both sides to work together to establish a mutual recognition system sometime in the future.

Also disappointing is that the UK will be leaving the educational Erasmus programme, which benefits thousands of students, and particularly Maltese students, who often opt to undertake part of their studies in UK universities.

Moving forward, and considering the time constraints, the MBB augurs that the ratification process of the agreement goes as swiftly and smoothly as possible on both sides in the coming days. This way the EU can truly start building a good trading partnership with the UK, which will provide some stability, given the current volatilities in the global economy.

Finally, the MBB encourages the Maltese Government to evaluate how Malta can benefit from the Eur5 billion Brexit Adjustment Reserve that has been agreed by the European Council last July, and now presented by the European Commission, to help counter the adverse economic consequences of Brexit on Maltese companies and the Maltese economy.