TRACY BLACK

With the coronavirus crisis dominating everyone’s thoughts, Brexit has been out of sight, though not quite out of mind. However, with news of a worrying lack of progress following the latest round of talks, anxiety is mounting among a Scottish business community that, let’s face it, has little resilience to spare.

As we’ve begun to take the first tentative steps into the recovery phase, every decimal point of economic growth has to be fought for. With fragile growth being a weakness of Scotland’s economy for years, long before this current crisis emerged, the task is more urgent than ever before. Make no mistake, getting the right Brexit deal can boost our recovery and that’s why businesses expect negotiators to approach talks with a determination to deliver.

Negotiation by video-conference is far from perfect, preventing the kind of sideline conversations that can help smooth differences in formal talks. Even more limiting is adhering to rigid negotiating mandates. Unless the dynamic shifts, it looks like both sides will stay trapped in a holding pattern, with no trade deal a real possibility at the end of the year, when the transition period is scheduled to end. For businesses, jobs and economic confidence in this most challenging of years, that would be a shocking outcome which must not come to pass.

For many firms fighting to keep their heads above water, the idea of preparing for a chaotic change in EU trading relations in seven months is beyond them. They aren’t remotely prepared. Stockpiles built to weather a Brexit storm are depleted and supply chains are fragmented by an unprecedented global pandemic. Many businesses, especially smaller ones, have burned through cash reserves they would have otherwise used for rainy days.

Before Covid-19, the UK led the world in professional services, with the country’s auditors, accountants and architects landing business across the globe. But as with many other sectors, services have been significantly impacted by the coronavirus crisis, with company surveys showing the greatest fall in all measures since records began. Perhaps by the end of the year these companies will be climbing back to their feet. However, an abrupt introduction of restrictions would likely damage our recovery in its infancy.

The net impact of no deal would be higher unemployment at a time when we will be fighting for every job. People in Scotland haven’t forgotten what mass unemployment looks like. Experiences of the 1980s left scars that even decades on are still to heal, and a spike in joblessness would once again hit hardest among those least resilient and most disadvantaged. For everyone’s sake, a cliff-edge scenario is not the answer.

So what is the solution? How do we break the latest stalemate?

There must be a strong injection of political engagement by both sides to break the impasse. The global pandemic could end up claiming many thousands of jobs in Scotland, and possibly millions across the UK. With jobs in every nation and region under pressure, the stakes are higher than ever before. An ambitious deal that works for both sides is the only way forward. Political leaders should step in urgently, change the dynamic and find solutions that protect people’s livelihoods and living standards.

There is no time to waste, the current air of resignation surrounding the Brexit talks must be shaken off immediately. The global response to coronavirus has shown us that nothing is impossible, so getting a good deal and using it to help spur our recovery cannot possibly be beyond us. It’s time for determination, cooperation and compromise to prevail.

Tracy Black is director of CBI Scotland