Figures show Brexit continues to depress trade with EU
Brexit is continuing to depress UK trade with the EU, with total imports and exports of goods in the first four months of this year down by a quarter compared to 2019, according to new official figures.
Calamitous trade figures in January – when exports fell by 38 per cent compared to the previous year – were blamed by ministers on “teething problems” after the abrupt transition out of the EU single market and customs union on New Year’s Day.
But after rallying in February as businesses came to terms with onerous new Brexit red tape, figures for the following two months showed what one expert described as “stagnation at below pre-Covid levels”.
Data from the Office for National Statistics show trade with the 27-nation bloc in April was 12 per cent below the same month in 2019 – the last year before Covid-19 disrupted trade patterns – while the total figure for the four months since the UK transitioned out of the EU was 25 per cent.
By contrast, trade with non-EU countries fell by just 4 per cent over the period January-April and rose by 3 per cent for April alone, compared to 2019 – indicating that the slump in commerce with Europe is unlikely to be caused by coronavirus.
Trade expert Thomas Sampson, associate professor at the London School of Economics, said that the data “continues to depress UK trade with the EU.”
Dr Sampson said: “Comparing changes in trade with EU versus non-EU gives a rough estimate of the Brexit effect, controlling for common supply shocks such as Covid-19.
“By this metric, Brexit cut goods trade with EU by 21 per cent so far in 2021 versus 2019.
“Or comparing April 2021 to April 2019 implies a minus-15 per cent Brexit effect.”
Dr Sampson told The Independent that the new figures appeared to show that the bounceback hailed by ministers in February has run out of steam, with trade settling down to a new normal below pre-Brexit levels.
And he said that further hits to trade could be expected with the expiry of UK government grace periods before the introduction of full controls on imports.
“As time passes, it becomes less likely that these are teething problems and more likely that we are seeing persistent effects of the TCA (Trade and Cooperation Agreement) on trade with the EU,” said Dr Sampson.
“The full adjustment is going to take years rather than months, and I would expect further changes over time.
“There was a bounceback in February and the hope was that this would continue in March and April. It is now clear that that did not happen.
“That is indicative that these are likely to be persistent effects and over time we will see those continue.”
New UK global trade deals will water down animal welfare standards warns RSPCA chief
Australia says WTO should punish Chinese economic coercion
Boris Johnson’s trade yacht plan could break World Trade Organisation rules