Brexit: Nissan deal "would be a disaster"

London – The UK’ government’s apparent arrangement to ensure car maker Nissan does not face extra costs relating to Brexit came under attack at a Chemical Industries Association (CIA) conference on the country's break from the EU.

After meeting government officials last month, Nissan announced that it would build two new models at its Sunderland plant, including the new Qashqai.

While UK ministers have denied having used sweeteners to seal the deal, the Japanese carmaker said it had been given assurances about its position, post-Brexit.

At the CIA conference on 17 Nov in London, however, chemical industry leaders seemed convinced that Nissan had been promised special treatment – and were concerned about the message this gave.

Commenting on the Nissan situation, Dr Angus Armstrong, director of macroeconomics at the National Institute of Economic and Social Research said "it would be a disaster " if this approach became part of government policy.

"The idea of looking after this company and that company is not an industrial strategy. That is just going back to the 1960s," said the economist.

Calling for a coherent, national industrial strategy, Armsrong said there was a need to rethink the dominant position of the financial sector and London within the overall economy.

In leaving the EU, he said, "a lot of the state aid rules and competition rules get taken off, and the government is going to have to get used to saying 'no'... But on the other hand it is also going to have to understand what compensation across the UK means."

These views were echoed by Heinz Haller, vice president Europe at Dow Chemical Co and chair of Cefic’s industrial policy programme, who said: “The Nissan announcement in late October wasn't exactly helpful, but this is sign of what is to come along sectoral lines,”

According to Haller, the government will come under huge pressure to safeguard the interests of particular sectors: the financial sector, the agricultural sector, the automotive sector.

And while he believed the UK economy needs all sectors to flourish on a dynamic and competitive basis,Haller concluded "in reality we will have to pay close attention to the interests of our chemical sector to make sure that these interests are fully represented at the negotiating table."