EU & INTERNATIONAL TRADE REPORT

EU TRADE

European trade proving challenging

finds a Chamber report

Following the end of the EU transition period on December 31st 2020, and the eleventh hour signing of the UK-EU Trade & Co-operation Agreement (TCA), firms were given only the shortest amount of time to prepare for new trade procedures. The TCA made no provision for trade in services and for manufacturers, new border checks were put in place as we left the single market and customs union.

West & North Yorkshire Chamber Chair, Nick Garthwaite said, “Findings contained within the report highlight significant increases in transportation costs faced by many firms, largely down to increased bureaucracy. Firms also reported inconsistencies in border checks across EU member states with 60% of manufacturing companies saying they had experienced difficulties exporting and one in two had faced challenges bringing goods into the UK. Many regional firms reported border delays, with examples of deliveries that would previously have taken two days to arrive at customer premises now taking 50 to 60 days and in some extreme cases, goods which had left the UK in January were still being held up and awaiting clearance into the EU. “Whilst the TCA retains tariff free access for UK goods which meet rules of origin criteria, the report highlights that this agreement is the worst possible deal for those firms whose business model relies on distribution of goods made outside of the EU. “The Chamber has concerns that the increased cost of doing business within the EU may put many companies off, causing them to scale back or withdrawing entirely from trading within the EU.” The latest ONS data on trade with the EU sets out in stark relief the impact new procedures have has with exports in Q1down18.1% on the previous quarter and imports down 21.7%. There are early signs that things may be improving for some and the Chamber is calling on the government to continue to support companies as they adapt to these new trade procedures. Looking to the future, we are hopeful that once firms gain more confidence with such things as rules of origin that they will start to expand their horizons. If a product or service sells well within the UK or EU then chances are there is a market for it elsewhere around the world. The full report can be downloaded from our website.

1QEU TRADE REPORT

Q1 2021

Important EU VAT changes for online sales