The problems created by the Brexit deal for British exporters
Boris Johnson hailed his Brexit deal, announced on Christmas Eve, as “Glad Tidings” and went on to claim that it would allow companies “to do even more business with our European friends”. He also claimed, astonishingly, that the deal would mean no non-tariff barriers. Did the Prime Minister in claiming this know he was telling a lie or did he simply not understand the details of the deal to which he had put his signature? Whichever is the case there is no doubt that the reality of the deal for so many of our exporters, and for our economy in general, has proved a cruel deception, involving loss of orders, delays in delivering goods and extra costs which in some cases are proving prohibitive and are threatening the viability of the companies in question.
While there is dispute over the actual figures there is no doubt that there has been a dramatic reduction in Britain’s exports to the EU from 1 January onwards. It is small companies, who are trying to grow their export business, and the vital food and drinks sector of our economy which have been particularly hard hit. I will quote a couple of examples from my own part of the country which vividly illustrate the problems experienced.
Firstly the fisheries sector which was promised so much by the Prime Minister and the Brexiters. My local port of North Shields is England’s largest prawn exporting port, the main customers, accounting for the majority of the business, being France and Spain. In the past the prawns arrived in France from North Shields the following day guaranteeing their freshness. Now this takes three days which for a product with a fresh shelf life of five days is far from ideal. Because of the new system of export hubs the prawns actually travel north to Glasgow first and then begin the long journey to the south coast. The new paperwork (a non-tariff barrier for the Prime Minister’s information) is complex and if the goods are part of a larger consignment then they risk being held up because of any mistake, even a minor one, by any other of the exporters in the group. On arrival at the port of entry in the EU costly customs procedures begin. The overall effect of the Brexit deal, if these problems are not dealt with, are threatening to any business’ survival in a competitive market.
The second example is that of a specialised brewery which has successfully built up an export market to the EU in recent years. Hit by Covid-19, the Brexit deal means that up to half of its remaining trade and income is in jeopardy. The products would normally arrive in the EU in five days. Indeed it was as easy to export to the EU as it was to send the product to anywhere in the UK. Yet in January, after the Brexit deal, its exports were held up for a month! Once again increased red tape, delays and extra costs have all been incurred. Again too there is the problem of being part of a larger consignment where one incorrect form from one supplier can penalise everyone else. The real fear is that previously loyal EU customers will go elsewhere if orders can not be delivered within speedy and efficient timetables.
These two companies and others I know of have been advised to set up subsidiary companies or depots in France or another EU country to avoid such difficulties. So Brexit means more jobs in the EU rather than in the UK does it?!
The government seems to be in denial about these issues. They are not trivial, nor “teething” problems but highly damaging to our economy. What folly to make life difficult in our nearest and biggest market. How alarming too that the Foreign Secretary talks about prioritising trade with countries elsewhere in the world and with poor human rights records rather than the established market on our doorstep which we helped to create and whose countries share democratic values with us.
Will the government listen to businesses in my part of the world and elsewhere in the UK, and finally see sense, change tack and accept once and for all that trade with our European friends and neighbours is essential to our future economic success and well-being?
Baroness Joyce Quin is a Vice-President of the European Movement, and a former MEP and Minister for Europe
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