Brexit will cause more damage to UK steel industry, warns trade body

The head of the trade association for the British steel industry has warned that Brexit could cause “a great deal of damage”.

Gareth Stace, the director-general of UK Steel, urged politicians to end the uncertainty, secure a withdrawal agreement and avoid the turmoil of leaving the EU without a deal.

He spoke out days after the collapse of British Steel, which put more than 4,000 jobs directly at risk and threatened a further 20,000 in the company’s supply chain.

In an article for The Guardian, Mr Stace said he wanted to “debunk” some of the claims made about the the failure of the company.

Brexit Party leader Nigel Farage has blamed the EU for the firm’s difficulties while insolvency experts claimed it was the “first heavyweight casualty of Brexit”.

“There can be no doubt that the ongoing Brexit uncertainty has contributed significantly to British Steel’s problems,” said Mr Stace.

“Unable to decipher what the UK/EU trading relationship will be in just five months’ time, planning has become fiendishly complicated for both UK exporters and their EU customers.

“The timing is particularly bad, with the EU having recently imposed ‘safeguard’ measures to prevent a surge in steel imports resulting from protectionist action elsewhere.

“Post-Brexit, UK steel exports to Europe will be restricted by these measures, with a disorderly no-deal Brexit affecting them particularly badly.”

He also rejected claims Brexit will provide steel with greater trading opportunities, given WTO tariffs on steel are already zero in developed countries.

After Brexit, UK steel would be less attractive to EU manufacturers because it would be classed differently, he said.

“In short, I must be honest in stating that Brexit will not improve the situation for the steel sector but it has the potential to cause a great deal of damage,” said Mr Stace.

“The number one priority to improve the outlook for steel, and the wider manufacturing sector, is to secure a withdrawal agreement as soon as possible, ending this uncertainty and avoiding the turmoil of a no-deal Brexit.”