UK fears being frozen out of lucrative ‘Made in Europe’ deals by French

BRUSSELS – Putting up new “barriers” between the EU and UK will harm European businesses and stop the continent from competing with China, the Business Secretary has warned.

Peter Kyle has pledged to lobby European powers – led by France – not to shut out Britain from a “Made in Europe” scheme which ministers fear will slow the progress of the post-Brexit “reset” of cross-Channel relations.

During a visit to Brussels, Kyle has signed a new deal to co-operate on enforcing competition law to help firms which want to do business in both the UK and the EU.

He said the arrangement would bring “predictability, stability and long-term planning” to international companies and help to grow the British economy.

Sir Keir Starmer’s Government is pushing to build stronger ties with the EU – although Kyle said that the British people were “not really nostalgic for the past” before Brexit as he denied trying to turn back the clock.

BMW worried about barriers, Kyle claims

But during his diplomatic blitz of the bloc’s capital, the Business Secretary also sounded a warning about the dangers that the “Made in Europe” plans might pose.

The policy, which is being led by Emmanuel Macron and a close ally of the French President who serves as the European commissioner for industrial strategy, is intended to prioritise EU businesses for government contracts and subsidies.

Kyle claimed that excluding British firms from the scheme would damage firms which operate across borders.

Speaking to reporters, he said: “I was very struck by the private conversations I’ve been having with manufacturers that are EU domiciled, manufacturers that are operating in the UK, such as BMW, and their concerns over the potential barriers being put up to the smooth functioning of their operations, which, from their perspective, harnesses the best of two distinct territories.”

The minister added: “We are already fully integrated in terms of manufacturing supply chains. And just look at Airbus, for example. Wings for Airbus are made in the UK and the part of the space program for Airbus is made in Swindon.
“So that’s just one example of a pan-European project which includes the UK, but has no bearing on the EU or its membership of the EU.”

He insisted he was not “lecturing or cherry-picking”, adding: “Having two sides that are aligned, that’s where the magic happens. And hopefully you’ve seen from the tone that I’ve taken while I’m here, that I’m really seeking where the alignment is, where the opportunities are.”

Teresa Ribera, the deputy to European Commission chief Ursula von der Leyen, refused to say whether or not the UK would ultimately be included in the “Made in Europe” scheme, joking: “I don’t like spoiling books or films.”

China ‘delivering breakneck growth’

Kyle contrasted European economies with that of China – which he visited last month along with Starmer – saying: “People are still not quite aware of the enormous success that China is having on creating innovation, but then commercialising it, but then – because of their 400 million people in their middle classes – they have the domestic market to upscale it at a speed that is frankly breathtaking.

“And you see their alignment is delivering economic and societal progress and growth that is breakneck.”

Under the terms of the new competition co-operation agreement he signed with Ribera, Britain and the EU will share information on investigations into whether big corporate mergers should go ahead, and work together to ensure firms cannot dodge the correct jurisdiction governing their activities.

Asked by The i Paper whether the relatively minor move would genuinely boost the UK economy, Kyle replied: “What business want, and what people want, is consistency, predictability and they want a vision which will be delivered into the long term… Today is just one more step along the way.”

He accused the previous government of a “two steps forward, one step back” approach to conduct post-Brexit relations with Brussels.

UK ‘will keep Trump tariffs discount’

The UK’s deal for a discount on Donald Trump’s tariffs will stay in place despite chaos over the future of the levies, the Business Secretary has predicted.

The so-called “reciprocal tariffs” introduced by the US President on trading partners last year have been struck down by the US Supreme Court.

In response, Trump announced a flat rate of 10 per cent on all countries, later raised to 15 per cent – which would be higher than the 10 per cent deal for most goods which was negotiated by Sir Keir Starmer.

But Peter Kyle revealed that following conversations with key trade officials in the White House, he is confident that the status quo will remain, with the UK’s exports hit with smaller levies than most other countries.

He told The i Paper: “The relationships that we have established since the early days of the Trump administration I am confident will deliver for the British people. Look around the world and Britain delivered the best deal, the first deal, and I think those achievements are still standing tall today.”

The minister said he expected confirmation that the deal remains valid to come from the US Government within days following a frantic transatlantic lobbying campaign.

He added: “We’re not in negotiations over a new deal. You know, with respect to what’s already been delivered, we’re after certainty so that we start moving on to other areas of co-operation.”

Jamieson Greer, Trump’s trade representative, provided cause for hope – telling Bloomberg TV: “The point is to recreate the policy that we’ve developed over the past year, to give continuity and be able to be in a position where we can honour the deals, but also have enforcement available.”

The US Supreme Court verdict last week struck down the tariffs on the basis that their justification was not legally sound, but the US President has announced new tariffs on a different legal basis.