Customs procedures still holding back UK exports

A survey of more than 1,300 UK businesses has revealed that customs procedures remain the top barrier to exporting.

Of those surveyed, 45 per cent of companies cited customs procedures as the number one barrier to exporting; 40 per cent of firms said geopolitical events have impacted their businesses over the past year; 37 per cent of exporters anticipate an increase in export business over the next 12 months; but 91 per cent of non-exporters do not expect to export.

Most exporters are not familiar with new or upcoming trade changes either, according to a major new survey of businesses by the British Chambers of Commerce Insights Unit, published during International Trade Week. More than 1,300 businesses took part in the online survey during July and early August.

Top perceived trade barriers

When asked what businesses (regardless of whether they export or not) perceive as the main trade barriers, 45 per cent cited customs procedures and documentation as the top answer. That is slightly down on the 2023 figure of 49 per cent. Other top barriers cited include export documentation (39 per cent), regulations and standards (35 per cent) and tariffs (33 per cent).

Of the companies surveyed, 40 per cent say geopolitical events have significantly impacted their business in the past 12 months. Issues linked to the war in Ukraine, conflict in Gaza and Brexit are cited as the main events impacting trade. They include energy costs and shipping delays.

A total of 37 per cent of exporting businesses expect an increase in exports over the next 12 months, with 16 per cent expecting a decrease. Manufacturers are the sector most likely to expect an increase in exports.

When asked what most would do to encourage them to export, businesses cited a need to improve access to the EU market, simplify trade regulations and reduce bureaucracy, and provide greater export support.

Lack of awareness for incoming trade changes

The survey shows awareness of incoming trade changes is low among firms who are actively doing business internationally and 65 per cent of respondents are unaware of the Border Target Operating Model. Ahead of the UK joining the Asia Pacific trade bloc CPTPP in December, over half of respondents (53 per cent) are unaware of the plans and 52 per cent of firms have no knowledge of safety and security certificates needed from this month for imports from the EU.

The launch of new biometric checks for foreign travellers, including Britons, entering the EU has the highest level of preparedness from business – 34 per cent of respondents are not aware and 37 per cent know some details or are actively preparing for the change, due later this year.

William Bain, Head of Trade Policy at the British Chambers of Commerce, said: “Though the picture has improved slightly in the last 12 months, customs procedures remain a significant stumbling block to trade for businesses.

“Successful exporting businesses are crucial to a thriving UK economy. We need roadblocks lifted to allow more companies offering their goods and services on the global stage.

“Our forecasts show the trading environment will continue to be challenging over the coming years, against a backdrop of geopolitical uncertainty.

“We’re urging the Government to continue the implementation of customs simplification started by the last administration. Businesses also need to see a clear timetable for further trade digitalisation which will help reducing costs and border friction.”