A Swedish Customs expert yesterday told Gibraltar businesses it is not too late to prepare themselves to “mitigate the risks” of a no deal Brexit should it occur.
Lars Karlsson explored what Brexit means for local businesses and how they can prepare as the UK and Gibraltar depart from the European Union.
He said a “smart border” will be an interesting concept for the Government of Gibraltar to ensure the continuous flow of imports from the EU bloc into Gibraltar after March 30.
However, with just 16 days left until the United Kingdom leaves the EU, he urged the private sector to “take responsibility” in preparing for Brexit, because not doing so “is a very dangerous strategy”.
As UK MPs yesterday again rejected Prime Minister Theresa May’s Withdrawal Agreement, Dr Karlsson said there is still a lot of uncertainty surrounding Brexit and what it means for trade.
Dr Karlsson is an advisor to the European Union and the United Kingdom on issues on customs, borders and trade matters related to Brexit.
He spoke to an audience of more than 100 business men and women from a cross sector of Gibraltarian businesses at the event organised by Customs at the University of Gibraltar.
The event was opened by Deputy Chief Minister Dr Joseph Garcia, who highlighted the government’s main concern is the importation of goods and exportation of waste, and Collector of Customs, John Rodriguez.
Dr Karlsson said he is concerned that there is a “false sense of security” within the private sector because Gibraltar has not formed part of the Customs Union in the past.
He said: “People are used to doing imports and exports from mainland EU and the UK, but businesses may not have looked at the consequences and that might be dangerous because it will cost a lot.”
The biggest impact will be on small family-run businesses in Gibraltar, and Dr Karlsson expects prices to go up in the near future to cover costs.
Businesses need to look at who they are working with, Dr Karlsson advised, including looking at who the goods are purchased from and where these goods are coming from.
He recommended local businesses get in touch with these companies they buy from and find out what their plans are with regards to Brexit.
The second piece of advice was to look at how much cost will be covered and what can be bypassed to maintain low costs.
In the event of perishable goods in supermarkets, Dr Karlsson advises business owners get in touch with their suppliers to find out if there will be possible delays.
He suggested businesses speak to brokers to ask for advice on Brexit and to ensure all permits and licences are in place.
“There are still 16 days, so do the analysis … it is not rocket science,” Dr Karlsson said.
Referring to Gibraltar’s border with Spain, Dr Karlsson said “this will be the real challenge” that will have an impact on Gibraltar.
He said: “This will be a real challenge and this will have an impact on Gibraltar for all the importing that you do.”
He suggested local businesses should speak to their UK suppliers and find out whether they would be willing to use alternative transport routes.
He also spoke about the benefits of a “smart border” where all the paperwork “obligations” are fulfilled before to allow the quick import of goods through an automated border.
“A smart border is about taking the technology and techniques already in place and make it more efficient,” Dr Karlsson said.
“It is about doing as much possible before and after the border.”
Dr Karlsson said the best example of this is the Swedish-Norwegian border that was introduced some 15 years ago.
He said this type of border demands a trust system between the government and the private sector.
After the event, the Chamber of Commerce’s Chief Executive, Edward Macquisten, told the Chronicle: “I cannot say how well-prepared businesses are in the event of a no-deal Brexit because different businesses have taken different levels of preparations.”
“There are certain things they can prepare for, and which they have done, but they are trying to prepare against the background of continued uncertainty.”
“Some businesses do not import goods, but they are concerned about people getting across the border to be able to work.”
“No one knows and only time can tell.”
Saccone and Speed’s Financial Director, Prakash Nagrani, said Dr Karlsson’s talk was an “eye-opener”.
He said the company started its “Brexit planning” from the very beginning and that the main challenge will be goods that they import from outside the EU.
Saccone and Speed has already liaised with its logistics company to find out what their plans involve.
“Some of the challenges faced by businesses in Gibraltar will be sourcing from smaller suppliers in Spain,” Mr Nagrani said, referring to the Gaggero Cemats section of the company.
John Isola, managing director at Anglo Hispano, said: “We are not going to have issues necessarily at the border, and in fact the border here is one side of things.”
“But for those of us who buy goods in the UK, I think that will be an issue if there is a no-deal Brexit, and it is totally unrelated to the border here.”
“Getting in the queue at the Channel is going to be as much of a problem as getting into the queue here.”
Pics by Johnny Bugeja