LONDON, Sept 25 — Brussels has told the United Kingdom's (UK) Prime Minister Andy Burnham that the UK needs to raise tariffs on Chinese cars and align more closely with European Union (EU) trade policy to avoid “made in Europe” barriers on key exports.
The Financial Times, citing two people familiar with the matter, reported on Friday that in response to lobbying for equal treatment for UK products, the bloc told London its best solution would be to join the EU’s customs union.
“A customs union would solve most of the problems of ‘made in Europe’. And also the question of tariff differences, which leads to fears the Chinese could avoid our tariffs by routing through the UK," an EU official told the paper.
In response to a request for comment, a government spokesman said, “We always put trade measures in place independently and based only on the UK’s economic interests and those of industry."
"However, Europe and the UK face many of the same challenges, which is why it is vital we protect trade flows between us," he said.
This week, Burnham said he would argue that the UK should be considered a "trusted partner" under the bloc's proposed "Made in EU" rules, warning that the UK's exclusion could damage its car industry.
The "Made in Europe" policy aims to curb reliance on Chinese components by prioritising European-made goods — a worry for the UK auto industry which feeds parts into EU supply chains and sells cars across the bloc.
European Commission President Ursula von der Leyen told the European Parliament in her 'State of the Union' address this month that the bloc would use every available tool to reduce its "unsustainable" trade deficit with China.
Reuters could not immediately verify the report. The EU and the UK Foreign Office did not immediately respond to Reuters requests for comment outside business hours.
