UK car and steel firms fear being frozen out of ‘Made in Europe’ deals by EU

An EU scheme to protect the bloc’s industries as the world reels from Donald Trump’s tariffs will be “very bad” for the British economy if the UK is shut out, a leading business chief has said.

Shevaun Haviland, director-general of the British Chambers of Commerce (BCC), told The i Paper that vital industries like car manufacturing and steel would “really struggle” if the so-called “Made in Europe” scheme excludes British firms that trade across the UK-EU border.

Business Secretary Peter Kyle has already been lobbying Brussels to include the UK in the scheme, which will give EU firms priority for Government contracts and subsidies, boosting their competitiveness against companies from outside the bloc.

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But if the France-led scheme treats Britain as a “third country” with no privileged access due to Brexit, it would be highly damaging for the economy, Haviland suggested.

She urged the Government to do whatever it takes to ensure British companies are not locked out of the scheme.

“We are very concerned about it,” Haviland said ahead of the BCC’s Driving International Trade Conference in central London.

“It will be very bad if we don’t get Made in Europe right.

“So we are working with our British chambers across Europe, with the ambassadors from Europe in the UK, to make sure we try and help them put pressure on our colleagues in the EU to make sure that the UK is part of those partner supply chains.”

According to reports earlier this month, Nissan has privately warned the UK Government that it could be forced to close its plant in Sunderland if the UK is not fully included in the Made in Europe scheme.

Elsewhere, Haviland backed Chancellor Rachel Reeves’ call for an “ambitious” youth mobility scheme with the EU, amid reports of wrangling in Whitehall over how tightly to set a cap on the number of visas that can be issued to European and British under-30s to travel, live and work freely between the two territories.

Youth mobility has proven the major sticking point in negotiations on the first round of Sir Keir Starmer’s so-called “Brexit reset” designed to draw the UK and EU back closer together.

But Haviland appeared to back the idea of a more generous cap, which is more likely to find agreement in Brussels, which would favour a scheme with no limit on numbers.

“We certainly want to see an ambitious package, absolutely, and I am pretty sure that the UK population, their concern on immigration isn’t about students who come and then they maybe go – that’s the visa that they’ve got.

“And I think we should try and stop thinking about all of this as a cost, and think about what return on investment universities or the economy will get from the ability to have these young people in the UK and our young people to go the other way.”

Haviland urged the Government to “speed up” the current negotiations, including on food and drink trade and linking carbon taxes, as well as backing the Chancellor’s push for the UK to align with EU laws across more sectors of the economy in a bid to boost growth and trade, even if it means following Brussels’ rules with no say and paying into the bloc’s budget.

She said: “We have to pragmatically, sector-by-sector, where it works – If you want to trade with someone, not just the EU, anywhere else we trade – you have to align to a certain degree to deliver the products that they need.”

“We say this to all political parties – the language of Brexit is old news, don’t use that language any more.

“Do you want your young people to be able to go to university in the EU? Yes, I do. Do we? Yes, we do.

“So, let’s get some big things over the line.”