THOSE still failing to grasp the permanent nature and the scale of the damage to UK exporters and trade from the country’s European single market exit – a camp which seemingly includes members of the Johnson Cabinet – should digest the latest official data.
They would also do well to heed British Chambers of Commerce’s warning that trouble with the paperwork needed for exports to the European Union – a requirement which has arisen entirely because of the Johnson administration’s hard Brexit and loss of frictionless trade – is having a “major effect”.
Of course, members of British Chambers and other businesses, of all sizes operating across a raft of different sectors, do not need to be reminded of this dismal reality.
However, Boris Johnson and his Cabinet most certainly do. They have persistently tried to claim Brexit has been beneficial. And we have even had the bizarre job title of Minister for Brexit Opportunities (and Government Efficiency) dreamed up for Jacob Rees-Mogg.
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Opportunities remain, predictably, elusive. Damage from the Brexit folly is, sadly, ubiquitous. Exporters remain under huge pressure and supply chains have been thrown into disarray. Companies and consumers have had to become used to a lack of availability, delays in getting materials and parts, and higher prices for the things they can buy. And businesses across a vast array of sectors have experienced damaging labour and skills shortages because of the loss of free movement of people.
Overall UK goods exports to the EU last year, following the country’s departure from the European single market, were down 11.8 per cent on 2018 levels at £152.27 billion, official figures showed last month. The Office for National Statistics has said that “comparing 2021 with equivalent 2018 data provides comparisons of trade with our most recent ‘stable’ period”. UK goods exports to the EU in 2019 were £170.73bn, so the 2021 figure is nearly £20bn lower than that total.
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And seasonally adjusted data published on Friday by the ONS showed UK goods exports to the EU in January, excluding precious metals, were down £3bn or 20.7% on December. Part of this month-on-month fall was attributed by the ONS to changes in data collection methods but British Chambers noted that, stripping out this estimated effect, the drop was still around £1bn or 7%. That is a big month-on-month fall, coming on the back of the dismal weakness in the 2021 figures for UK goods exports to the EU.
Tory Brexiters, however, are surely giving people the impression they are sadly out of touch with the realities of the situation.
Conservative MP Sir Desmond Swayne, a supporter of the Leave Means Leave pressure group, declared in Parliament earlier this month: “UK aid promoted trade in Africa by making borders seamless through digitising all the administrative processes. Is that on our agenda for trade with the EU at all? It is monstrous that we are filling in forms.”
What did Sir Desmond think leaving the single market and giving up frictionless trade with countries in the world’s largest free trade bloc would mean?
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If you wrench yourself out of the world’s biggest free trade bloc and go even further by refusing to accept regulatory alignment, British exceptionalism is not going to mitigate the inevitable damage.
And the Tory Brexiters cannot talk away the actual, huge effects of Brexit. Hot air is not going to make the current reality float off to be replaced by the one the Conservatives seemingly hanker after.
Mr Rees-Mogg meanwhile declared last month that he thought “the evidence that Brexit has caused trade drops is few and far between”.
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He also proclaimed: “I think Brexit has been extremely beneficial for the country.”
To many households and businesses struggling with the everyday realities of Brexit, this will seem like an utterly extraordinary take on the situation.
Members of the Liberal Democrats at the weekend endorsed a “four-stage roadmap” to establish the UK’s future trading relationship with Europe.
This proposes, firstly, “immediate action to improve links with our European neighbours”. Secondly, it advocates “further steps to build confidence and establish stronger relationships with Europe, including seeking cooperation agreements with EU agencies, returning to Erasmus Plus and seeking to reach a UK-EU agreement on asylum seekers”.
The third stage of the plan is “deepening trade with Europe, including by negotiating greater access for our world-leading UK food and animal products to the single market, securing deals on sector-specific work visas and establishing mutual recognition of professional qualifications”.
Fourthly, the Liberal Democrats propose with their roadmap that “once the trading relationship between the UK and the EU is deepened, and the ties of trust and friendship are renewed” the aim should be “to place the UK–EU relationship on a more formal and stable footing by seeking to join the single market”.
This makes perfect sense. However, the four-stage roadmap is likely to be no more than a valiant effort at suggesting a common-sense approach for the UK to restore friendly and beneficial trading and other links with Europe – ties which have been severed in some cases and severely frayed in others by the Johnson administration’s actions.
With the Tories having a huge majority, there is no prospect of the Liberal Democrats’ suggestions turning into any kind of reality at least for now. We should also bear in mind that the Liberal Democrats, by forming a coalition government with former Tory prime minister David Cameron in 2010, set in place a chain of events which brought Brexit about.
Whatever the case with all that, the official data tell a very different story of Brexit to that being peddled by the Tory Brexiters.
The ONS noted on Friday that its business insights and conditions survey, published in February, showed “67% of exporters and 72% of importers faced challenges in late January to early February 2022”, with “additional paperwork, change in transportation costs and customs duties or levels being the top challenges for traders”.
It added that this compared with 64% of exporters and 61% of importers reporting trade challenges in January to February 2021.
British Chambers head of trade policy William Bain said: “It is noteworthy that exports to the EU continued to fall in January this year.
“ONS business insights and conditions data match our own, suggesting more traders experienced difficulties with paperwork on EU exports as 2021 went on, and in the early part of 2022. This is having a major effect on trade.”
British Chambers urged action again as it expressed concern over “continued weakness of UK exports to the EU”.
So what should we take on board in assessing the reality of the situation? The views of businesses and the organisations that represent them, the official statistics on trade and on the difficulties being encountered by exporters and importers, and what we see day by day for ourselves? Or the words and opinions of Sir Desmond, and of Mr Rees-Mogg and his fellow Cabinet members? Take your pick.
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