UK Government decision not to extend EU transition period is an act of economic vandalism

The economic impact of the global pandemic has started to take effect - companies going into administration and jobs being lost. Unfortunately, worse is to come.

Last week the OECD released a report which showed that the UK economy is predicted to suffer the worst damage from the Covid-19 crisis of any country in the developed world – a slump of 11.5% in GDP in 2020.

It is with this economic backdrop that the UK is negotiating a trade deal with the European Union. With Governments across Europe having understandably turned their attention towards tackling the covid-19 pandemic, talks have barely progressed since March.

Even before the pandemic, the aim of reaching a deal by the end of 2020 seemed a tad optimistic. Add in the impact of the covid pandemic, and it seems impossible. There remain numerous areas of disagreement – particularly around the ‘level playing field’ provisions, the Irish border, arbitration procedures and areas such as fisheries.

It is clear that the transition period needed to be extended in order to deliver a good trade deal. The alternative is that we leave with a rushed, poor deal, or crash out with no deal, which the UK Government itself predicts will be disastrous for the Welsh economy.

Recent surveys show that two-thirds of the population support an extension to the transition period. Even half of those who voted to leave support an extension. Common sense tells us that in the middle of a global pandemic, we need more time to get this right.

The fact that the UK Government has refused to listen to Plaid Cymru and others in seeking an extension to the transition period is an act of economic vandalism.

Boris Johnson had the opportunity to protect our economy from the double shock that is on the horizon. He chose not to take that route, and as a result, has risked untold damage to the Welsh economy.

Dr. Dai Lloyd MS

Shadow Minister for International Relations and Leaving the EU