JCB chairman, Lord Anthony Bamford, has said that trading on World Trading Organisation terms is “nothing to fear” if the UK left the European Union without a deal.
In a letter to Editor of the Daily Telegraph, he wrote: “As the clock ticks down to our exit from the European Union, following the second referendum in 2016, I feel compelled to say this about a no-deal Brexit: there is nothing to fear from trading on WTO terms.
“I have decades of experience selling British-made machinery to WTO and EU countries.
“Nearly three quarters of what we manufacture in the UK is exported. Likewise, my company buys components from all over the world.
“Trading with Australia on WTO terms is as natural to us as trading with Austria on EU single-market terms.”
Earlier this year in June, Australia and the European Union launched negotiations for a free trade agreement. The EU is Australia’s second largest trading partner.
The UK is required to wait until it has left the European Union before it can negotiate its own free trade agreement with Australia, until then it will continue to trade on WTO terms.
'Not the end of the world'
Lord Bamford highlighted that 40% of JCB’s exports currently go to WTO countries, with only 27% going to EU countries.
He added: “We import components worth over £250m from WTO countries.
“This two-way trading arrangement happens every day as a matter of routine for JCB. It can work just as well for other British businesses.”
He admitted that any changeover to WTO terms would be “somewhat disruptive” to businesses, but that they will “adapt”.
“My message is simple: businesses will adapt,” he said. “It will not be the end of the world.
“Ports will also adapt to the change in the regulatory landscape and, besides, Dover is not the only UK port.
“There are about 120 other commercial cargo ports. These will take up the slck if Dover can’t handle everything.”
Health Secretary Matt Hancock suggested earlier in December that Channel ports such as Dover could face disruption for up to six months if the UK left without a deal.