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16th Feb 2022

Brexit: Research proves leaving EU has harmed business

Ava Evans

Majority of businesses say Brexit has harmed revenue

UK exporters to the EU have been knocked by Brexit and businesses have faced higher costs, more paperwork and border delays since Britain’s withdrawal, new research shows.

The survey, carried out by the British Chambers of Commerce, found 71 per cent of businesses felt the EU trade deal was not enabling them to grow or increase sales.

Overall, just 8 per cent of firms agreed that the UK’s withdrawal from the EU was “enabling their business to grow or increase sales”, while 54 per cent disagreed.

But the majority of exporters said Brexit had pushed up costs, increased paperwork, delays, and put the UK at a competitive disadvantage.

Pain was mostly felt by smaller businesses who said the new Trade and Co-operation Agreement had introduced new levels of bureaucracy that they did not have the time, money or facilities to cope with.

Other business expressed concern over the prospect of dwindling international trade, complaining Brexit red tape had put off EU customers from considering UK goods and services due to the perceived costs and complexities

Responding to the findings, Labour lambasted the government for showing a “complete lack of support” to businesses.

Labour’s Shadow International Trade Secretary Nick Thomas-Symonds MP said the government should be negotiating a “veterinary agreement and working pragmatically with the EU to ensure goods flow easily”, but was currently “asleep at the wheel”.

On Wednesday, newly appointed minister for Brexit opportunities Jacob Rees-Mogg visited the UK’s biggest container port in Felixstowe, Suffolk.

He urged firms struggling with red tape to write to him, and pledged to tackle issues surrounding trade with Europe.

Speaking to the BBC he said “We don’t want to replace a European bureaucracy with a home-grown bureaucracy,

“My role is to try and cut through this thicket. My role as the Brexit opportunities minister is to find out where regulations exist that we don’t need, and to try and get rid of them.”

He added there was little evidence to prove that leaving the EU has damaged UK trade.

Last week, the UK Public Accounts Committee confirmed Britain’s exit from the European Union has so far made trade more expensive because of delays and red tape.

It concluded there was a “clear increase in costs, paperwork and border delays” for UK businesses since Brexit, and warned an uptick in post-pandemic tourism and trade would further exacerbate problems at ports.

The cross-party committee of MPs said without prompt government action it expected further disruption later this year as new import controls start.

Transport group Logistics UK backed the committee’s findings, warning traffic could “grind to a halt” if more wasn’t done soon.

A spokesperson for the Government said: “The Trade and Cooperation Agreement is the world’s biggest zero-tariff, zero-quota free trade deal. It allows businesses in Britain to trade freely with Europe while also being able to seize new trading opportunities with countries around the world.

“We’ve always been clear that being outside the single market and the customs union would mean changes and that businesses would need to adapt to new processes. That is why we are ensuring that businesses get the support they need, including through the free-to-use Export Support Service.

“Goods exports to EU nations were 4% higher last year compared with 2020. However, given the covid-19 pandemic, global recession and supply chain disruption, it is still too early to draw any firm conclusions on the long-term impacts of our new trading relationship with the EU.”

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