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Brexit and Covid hit UK EU trade

[ May 25, 2021   //   ]

The latest Office for National Statistics report shows a steep fall in trade with both EU and non-EU countries – with Brexit having a bigger impact than Covid, says broker ParcelHero.
It says that trade with EU countries has declined 23.1 in the first quarter of 2021 with steep declines in imports and exports to both the European Union (EU) and the rest of the world.
ParcelHero’s head of consumer research, David Jinks said the figures gave the true picture of the damage done to UK trade by both events. He argued: “‘Total trade in goods with EU countries decreased by 23.1% in the first quarter (Q1) of 2021 compared to Q1 2018. Contrary to the optimistic claims of Brexiteers during the referendum, this was not balanced by an increase in trade to non-European countries, such as the US. Non-EU trade declined 0.8% in the same period, though total trade with non-EU countries surpassed that with EU countries in the first quarter of 2021 for the first time.”
In mid-February 2021, over 55% of exporters said Brexit changes were causing them problems, compared to only around 10% of exporters saying Covid was a challenge.
Jinks added that trade with Germany (the UK’s biggest EU partner) and Ireland – two of Britain’s main trading partners – has collapsed significantly. Between December 2020 and January 2021 alone, Germany experienced the greatest fall in UK trade of any major trading partner – £1.7 billion and, since Q2 2020, the UK has imported more from China than from Germany.
Exports of goods to Ireland saw the greatest proportionate fall of the UK’s top five markets after the EU transition period ended, down by 47.3% (£1 billion) between December 2020 and January 2021, while imports from Ireland fell by 4.4% (£0.1bn).
Jinks blamed the eleventh hour EU deal that contained huge fudges, including both the Northern Ireland Protocol and overcomplicated proof of origin requirements to prove items were made in the EU or UK.
https://www.parcelhero.com/research/brexit-study

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