Bruises from Brexit start to show in U.K. chemistry enterprise | July 18, 2016 Issue - Vol. 94 Issue 29 | Chemical & Engineering News
Volume 94 Issue 29 | p. 5 | News of The Week
Issue Date: July 18, 2016 | Web Date: July 14, 2016

Bruises from Brexit start to show in U.K. chemistry enterprise

Key organizations are ready to fight for sector’s future, as scientists experience exclusion, xenophobia
Department: Business
Keywords: economy, Brexit, economy, chemistry, EU
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Despite bumps in the road caused by Brexit, Ineos will invest millions of dollars to expand this ethyl acetate plant in England.
Credit: Ineos
Photo of a chemical plant at end of grassy path located in Hull, UK.
 
Despite bumps in the road caused by Brexit, Ineos will invest millions of dollars to expand this ethyl acetate plant in England.
Credit: Ineos

U.K. chemistry organizations are preparing to fight off an array of adverse impacts as Britain exits—or Brexits—the European Union. The Chemical Industries Association (CIA) and the Royal Society of Chemistry (RSC) will soon publish manifestos setting out what they expect of the U.K. government as the country prepares to negotiate its least painful route out of the EU.

Manifesto

Chemistry enterprise sets out its must-haves post-Brexit

▸ Free movement of workers and scientists

▸ Maintenance of research and innovation funding levels

▸ Competitive energy costs

▸ Access to the single European market

▸ Clear regulations that support U.K. citizens, businesses, and researchers

CIA’s manifesto will assert three positions that it says are essential for the future of the U.K. chemical sector: access to the EU’s single market, no restriction on workers—including scientists—moving between the U.K. and the EU, and competitive energy costs.

CIA’s manifesto will also contain forecasts relating to potential adverse scenarios, such as the imposition of tariffs on the export and import of chemicals between the U.K. and the EU.

CIA is prepared for plenty of give-and-take as part of Brexit negotiations. “If we want access to the single market, we are going to have to accept harmonization on a lot of regulations,” says Tom Crotty, CIA’s president and a member of the board of Ineos, a chemical firm with significant U.K. operations.

RSC has also set out three must-have negotiating positions: maintaining research and innovation funding at present levels; easy movement of skilled scientists and students to and from the U.K.; and clear regulations that support U.K. citizens, businesses, and researchers.

Although exit negotiations are not set to begin until early 2017, initial signs are that Brexit is already adversely affecting the U.K. chemistry enterprise. There is anecdotal evidence that U.K. organizations are being excluded from some collaborative EU science projects, according to CIA’s chief executive, Steve Elliott.

The Russell Group, an umbrella organization for 24 leading U.K. universities, has also gathered anecdotal evidence of the problem. “But at this stage, it does not look like it is systematic,” the group says.

The U.K. receives more than $1 billion annually in funding for science projects under the EU’s Horizon 2020 research program. This represents about 3% of all U.K. science funding.

In a more sinister twist, since the U.K.’s June 23 vote to Brexit, the country appears to be experiencing a spike in racist attacks, some of which have been directed against scientists on university campuses. “We simply will not tolerate abuse of this sort, and any student or staff member who experiences racism or xenophobia on or off our campuses can be assured this will be taken extremely seriously,” says David Greenaway, vice chancellor of the University of Nottingham and chair of the Russell Group.

Growth in the U.K. economy is expected to fade in the coming months as a direct result of Brexit. In a bid to boost industry confidence, the U.K. government has announced it will provide $75 million in extra funding for industry-facing research in fields such as biotechnology, pharmaceuticals, and quantum technologies.

There is widespread concern that U.K. chemical companies may delay capital investment projects until after Brexit. Yet Ineos recently heralded what it calls the first major U.K. investment decision after the Brexit vote: its plan to invest millions of dollars to expand the capacity of an ethyl acetate facility in Hull, England, by 100,000 metric tons per year.

A silver lining on the Brexit cloud is that U.K. companies may not have to comply with the next round, starting in 2020, of the EU’s emissions trading scheme, which CIA predicts will carry a major financial burden. As a trade-off for the adverse impacts from Brexit, it is, though, “small beer,” Elliott notes.

 
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Comments
Cliff Burford (Tue Jul 26 23:31:49 EDT 2016)
Agree that delays in investment in UK facilities by British companies due to uncertaintiea because of Brexit are worrying.
Potentially much more serious consequences are investment delays and even dis-investment in the UK by foreign companies, e.g. Japanese car makers.

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