LONDON (AP) — A key business lobby warned Britain's government Monday not to play favorites among industries when it negotiates the country's exit from the European Union, saying that ignoring any sector would hurt the entire economy.
The Confederation of British Industries and the international law firm Clifford Chance also said in a new report that it is critical for the government and the EU to have some sort of agreement in place by the end of the legally mandated two-year negotiating period to avoid "significant commercial and economic disruption."
The report reflects increasing anxiety among some businesses that the government hasn't been open enough about its goals for Brexit and that their concerns are being drowned out by the needs of banks and fund managers.
The Times of London reported last week that a leaked report showed the government had divided British industries into high, medium and low priority in the Brexit negotiations — giving some sectors priority at the expense of others.
"To be a success, the UK's new relationship with the EU must meet the needs of our whole economy — covering business in every sector, size and location — as the consequences of leaving any part behind could have knock-on effects for others," Josh Hardie, deputy director-general of the business lobby, said in the report.
The Confederation of British Industries says it represents about 190,000 businesses that employ 7 million people, or a third of Britain's private-sector workforce.
The report comes as Parliament debates legislation that would give Prime Minister Theresa May the authority to trigger two years of negotiations on Britain's future relationship with the trading bloc of 500 million people.
If there is no agreement at the end of that two-year period, Britain would probably be forced to trade with the EU and many other countries under World Trade Organization rules, which would increase tariffs on goods and make it more difficult for firms to sell their services across borders, the CBI and Clifford Chance said.
Since it will be difficult to complete the negotiations within the allotted time period, the government should consider an interim arrangement that would bridge the gap, according to the report.
"Trading solely under WTO rules would give rise to a high risk that businesses in the EU and the U.K. and many international companies doing business with both would be subject to significant commercial and economic disruption," the report stated.
The negotiations are critical to the British economy because international trade accounts for almost 60 percent of gross domestic product, according to the report. About 85 percent of the country's trade is with EU member states or countries that benefit from preferential arrangements with the bloc.