Trade

Liam Fox: No customs union with EU after Brexit

SHANGHAI — Theresa May’s trip to China ended just as it began — mired in internal Tory strife over Brexit.

As she prepared to depart on the final stop of her three-day tour of the country, International Trade Secretary Liam Fox threatened to blow open a fresh row over Britain’s departure from the EU by insisting the U.K. could not remain in any customs union with Brussels after Brexit because it would end the prospect of signing new trade deals.

The intervention threatened to overshadow the prime minister’s own interviews in Shanghai where she sought to put to bed the rumbling row in Westminster over the leaking of internal Brexit impact assessments earlier this week.

“It is very difficult to see how being in a customs union is compatible with having an independent trade policy because we would therefore be dependent on what the EU negotiated in terms of its trading policies and we’d be following behind that,” Fox told Bloomberg TV.

“We have to be outside of that to take advantage of those growing markets. One of the reasons we are leaving the European Union is to take control and that’s not possible with a common external tariff.”

His remarks fly in the face of the prime minister’s stated policy that she has not ruled out striking a new customs arrangement with Brussels to protect “frictionless” trade while also allowing new trade deals to be signed with countries outside Europe.

The confusion comes ahead of a series of crunch meetings of leading Cabinet ministers next week designed to hammer out a consensus on some of the key issues on Britain’s desired future relationship with the EU after Brexit.

The week began with a leak to Buzzfeed News of the government’s secret assessment of the economic cost of leaving the EU under various scenarios — all of which would cause a significant slowdown — sparking fury among Brexiteers.

Speaking in China’s commercial capital Friday morning, May dismissed the leaked assessments as unfinished but indicated she would take Britain out of the EU regardless of the economic cost because it was the will of the people.

Her comments are likely to alarm leading “soft” Brexiteers in her party pushing for as close a relationship with the single market and customs union as possible but will be cheered by those in her Cabinet leading the charge for a clean break from the EU.

The prime minister said she would not be sacking her Brexit Minister Steve Baker despite revelations he misled the House of Commons over claims the civil service was working to undermine the U.K.’s exit from the European Union. May’s support for her beleaguered junior minister will spark further accusations that she is too weak to control the warring factions in her party, split over the scope and nature of Britain’s impending departure from the EU.

Asked on Channel 5 News whether she was going to fire Baker, she said: “No. The ministerial code says that the minister should take the earliest opportunity to amend the record that he has given to parliament and apologize to parliament. He will do that.”

May said civil servants and politicians were working together “to ensure that we do something very simple, which is deliver on what the British people asked us to do.”

She said this meant leaving the EU “in a way which enables us not only to take back control of our money and our borders and our laws but also enables us to trade around the world.”

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