Brexit’s Impact: UK-EU Trade Faces Disruption as Economists Warn of Declining Exports
British businesses are grappling with an alarming decline in goods trade with the EU, a profound consequence of Brexit’s red tape, according to recent economic reports. New findings from Aston University Business School reveal a staggering 27% decrease in UK goods exports to the EU and a 32% drop in imports over the three years following the Brexit trade deal signed in 2020.
Despite some growth in specific sectors such as tobacco, railway, and aircraft exports, the overall diversity of British export goods has significantly diminished, with 1,645 fewer product types available to EU countries. The report highlights a “noticeable worsening” of EU-UK trade conditions in 2023, indicating that the negative impacts of the trade agreement have intensified, leading to more pronounced declines than in previous years.
Industries such as agriculture, clothing, and wood and paper manufacturing have experienced the most severe repercussions, with many sub-sectors seeing their EU export values plummet by over 50%. Edible fruit and nuts faced the steepest decline, suffering a dramatic 73.5% loss in export value.
Smaller British producers are particularly affected, often abandoning exports to certain EU nations due to the complexities introduced by new trade regulations and non-tariff barriers. Increased requirements for safety checks and labeling have complicated the exporting process, imposing significant challenges and costs.
Mary Quicke, a cheese producer from Devon, expressed frustration over the regulatory burdens that have made it impossible for her to maintain previous customer relationships in the EU. “We just don’t have the people to do the paperwork,” she stated, exemplifying the struggles many face in navigating post-Brexit trade logistics.
A government spokesperson confirmed ongoing efforts to enhance trade relations with the EU and reduce unnecessary barriers while clarifying that there will be no reversion to the single market or customs union. Meanwhile, business representatives have begun discussions with government officials to explore avenues for “resetting” the trade relationship, with a focus on ensuring economic security.
However, meaningful progress on this front is anticipated only after the establishment of the new European Commission next year, as the UK embarks on revising its industrial and trade strategies. The challenges posed by Brexit continue to resonate across various sectors, underscoring the urgent need for strategic solutions in the evolving trade landscape.
