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Can British service companies really flourish after Brexit?

Michael Gove says so – but his view may be somewhat optimistic, writes Sean O'Grady

Tuesday 26 November 2019 19:07 GMT
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One of the great curiosities – and tragedies – of the debate on Brexit is that the trade aspects have focused almost entirely on movements of goods, including agricultural products, livestock and the like, rather than the services sector. Yet manufacturing, agriculture, mining and other “physical” activities make up only about 15 to 20 per cent of British economic activity (and the Irish aspects a tiny part of that total). The other 80 per cent is in services. And yet the trade with Europe in services receives only a fraction of the attention that areas such as car manufacture or pharmaceuticals or the Irish backstop have had (though they of course deserve the media coverage).

The cabinet minister Michael Gove displayed a remarkable degree of insouciance in his radio interview on the BBC Today programme yesterday. He implied that there was no single market for services in the EU, which I only partially correct. It is certainly incomplete, but there are great swathes of it that are vital to UK interests.

The key to the product is the reciprocal recognition of professional qualifications, of standards, of rules, of the development of common pan-EU rulebooks and administrative/regulatory authorities; and the opening up of service sector activity to free and fair competition, so that government procurement of services, for example, is open to companies across the EU on a “level playing field”.

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