Ian McConnell: Brexiter spin cycle at full tilt as exporters tell us the sorry truth: Opinion

The exporter’s exasperated comments reflected the realities on the ground – difficulties that need to be fixed to the maximum extent still possible by a UK Government which delivered not only a hard Brexit but also boxed itself into a corner by shunning regulatory alignment. Ms Truss’s contribution was another “doth protest too much” refrain from a UK Government minister – which sounded like so many of the others – painting a picture of a resurgent Great Britain on the international trade front.

It is not clear how exporters can enter this seemingly utopian alternate reality occupied by the Boris Johnson Cabinet – a dimension with many flags.

In the real world, things are very different indeed. Chaos upon shambles has resulted from the Johnson administration’s hard Brexit, the negative effects of which are permanent even if the spectacular immediate woe has been exacerbated by the UK Government’s extreme lack of preparedness for its own chosen form of rupture from the European Union.

The worse it has become, the more determined Ms Truss and her fellow Cabinet members, and other Brexiters, have seemed to declare things are the opposite of what they are.

Much of this has involved the portrayal of various free trade deals which are essentially extensions of what the UK had as part of the EU as big, brave new things which highlight Mighty Blighty’s supposed new-found power on the international stage. This is, of course, a nonsense. But the electorate, though notably not in Scotland and other parts of the UK which opposed Brexit such as London, seems to be buying into it spectacularly.

Boris Johnson Picture: Yui Mok/PA

It is sad the degree to which people have been led a merry dance by the Brexiters, in the run-up to and since the 2016 vote. The degree of political gaslighting has been truly extraordinary.

For exporters, unlike for members of a Johnson Cabinet revelling in whatever it is they think they are doing, there is no escaping the grim daily reality of the UK’s hard Brexit.

Jamie McMillan of Lochfyne Langoustines took to Twitter on Tuesday to highlight continuing frustration over what has transpired following the UK’s exit from the European single market on December 31.

Mr McMillan declared: “BREXIT update!!! 38 pages of paperwork today to export to France over £500 in EXTRA costs per shipment absolute madness! We [were] not told of this pre Brexit and now it’s crippling businesses around the country.”

It is worth reflecting on the detail of this for a moment: £500 in extra costs per shipment for a business the size of Lochfyne Langoustines.

The British Meat Processors Association meanwhile declared on Wednesday that dismissing trade disruption at the borders as simply short-term “teething problems”, a term used by the Prime Minister, “is no longer credible”.

It added: “As we near the end of the first quarter of trading outside the EU single market, British meat companies are painting a very different picture. They are reporting systemic weaknesses in the current export system, mountains of red tape and a potential permanent loss of trade of between 20 and 50 per cent.”

That is a big loss.

The BMPA declared: “Systemic problems pose a bigger challenge, and some are simply not fixable like the 60% to 100% increase in certification costs for each export consignment which is costing the industry an estimated £90 million to £120m a year. These include the costs for customs declarations, customs agents, freight forwarders and additional veterinary inspections, and are rendering certain exports unviable.”

That is a major cost. But that is not all.

Picture: Stefan Rousseau/PA (Image: Stefan Rousseau/PA)

The BMPA added: “However, the headline figure doesn’t take into consideration the extra ‘hidden’ costs from higher freight insurance, extra administrative staff and higher haulage charges to compensate for longer delays.”

And the bad news does not end there.

The association said: “Unfortunately for British companies, the changes that could improve the system are complex and lengthy. During the time it will take to implement these changes companies will continue to lose trade with EU customers.”

We are sadly so far away now from the frictionless trade with the EU abandoned by the Johnson Government on December 31.

Ms Truss appears, in stark contrast to Mr McMillan and the BMPA, to be quite happy with the UK’s diminished circumstances, although it is worth bearing in mind the earlier point about the Brexiters seeming to occupy an alternate reality.

And perhaps she does not see the UK’s circumstances as having been diminished by the Tory hard Brexit.

While Mr McMillan was facing the huge burdens that have fallen on exporters, Ms Truss tweeted on Tuesday: “Today I am announcing four major trade & investment hubs in Belfast, Cardiff, Darlington and Edinburgh.”

Oh, and, of course, there was a Union Flag emoji at the end of that sentence.

She declared: “These [hubs] will: Support great British exports/ Bring Office for Investment support across the UK/ Ensure businesses can feed into trade deals.”

Ms Truss reminds us that Office for Investment is “a joint initiative with the Prime Minister’s Office – to channel investment money into every UK nation and region”.

This initiative comes at a time when the UK Government is on a massive drive to market what it views as the benefits of the Union, at a moment when the Scottish independence question is very much back in focus.

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Ms Truss’s other points about how the hubs will “support great British exports” and “ensure businesses can feed into trade deals” seem most incongruous, especially when viewed in the context of Mr McMillan’s tweet on the same day.

Brexit has hammered “great British exports” because it ended frictionless trade with the UK’s biggest trading partner, the EU. Ms Truss and her fellow Cabinet ministers often seem at pains to do business with anyone but the EU, with the Secretary of State for International Trade apparently happier to join the Trans-Pacific Partnership than be a member of the European single market. But this attitude does not change the simple facts – the EU is the UK’s biggest export market. It is on the UK’s doorstep. And the best thing for “great British exports” and those who depend on them for their livelihoods is to have frictionless trade with the EU.

Seasonally adjusted figures published this month by the Office for National Statistics showed a record 40.7 per cent or £5.6 billion fall in UK goods exports to the EU between December and January. Ms Truss might want to reflect on this.

The “can feed into trade deals” from Ms Truss is also pretty rich. The big, brave new trade deals promised by the Brexiters have not materialised. Even if the big one pursued by Ms Truss, a free trade deal with the US, materialised, the benefits would be tiny compared with the damage done from loss of single-market membership. That is a reality that has not changed either. And it will not do so, regardless of how much the Brexiters might try to make the UK electorate accept their alternate reality as actuality, and even if they are enjoying major success with this propaganda drive.

The much-vaunted free trade deal the Conservative Government wants to do with the US would, according to the Johnson administration’s own estimates, add 0.16% at most to UK gross domestic product on a 15-year horizon.

Forecasts from the Theresa May government in 2018 showed Brexit would with an average free trade deal result in UK GDP in 15 years’ time being 4.9% or 6.7% lower than if the country had remained in the EU, on respective assumptions of no change to migration arrangements and zero net inflow of workers from European Economic Area countries. The Tories have lamentably clamped down on immigration, so the less bad of these forecasts, which still shows enormous damage to the economy and living standards, is now way over-optimistic.

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These cold numbers must always be borne in mind when listening to the peculiar perspectives on “great British exports”, whether with a capital “G” or not, from Ms Truss and her Cabinet colleagues.

As an aside, it turns out the Edinburgh hub unveiled by Ms Truss is something of a relaunch. However, unlike the continuity trade deals replicating what the UK has had with the EU trumpeted so loudly by the Johnson Government, at least there seems to be some material differences with this relaunch.

The press announcement from the Department for International Trade and Ms Truss stated: “An existing DIT hub in Edinburgh announced in September last year will see a significant increase in headcount following its relaunch today.”

Promoting her new hubs, Ms Truss made no reference to the huge troubles arising from Brexit. This was unsurprising but it is difficult nevertheless not to find this bizarre, given these woes surely constitute an elephant in the room.

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She declared: “They (the hubs) will mean we can channel investment into all corners of the country, and that exporters – whether they’re selling Scotch beef, Welsh lamb or cars made in the north of England – have access to the expertise they need to sell into the fastest growing markets.”

Big talk, but the hubs are not going to compensate in any meaningful way for the damage of Brexit. And it is interesting she mentions the meat industry, given the BMPA report.

Ms Truss also proclaimed: “I’m determined to use UK trade policy to benefit every part of the UK. These trade and investment hubs will help this country to an export and jobs-led recovery.”

The trade policy of this UK Government, vis-à-vis Brexit, is damaging every nation and region of the UK. And the Tory hard Brexit has hampered severely the prospects of an “export-led” recovery, and is costing jobs.