SecondBrexit is beginning to have an impact. Trade with the EU has been affected, and foreign investment is moving south.Both of these trends are not temporary and will harm the government’s stated goals. “Upgrade” area Until now, they have relied on overseas trade to create high-paying jobs.
It is unclear whether the Red Wall noticed. Or anyone of the 17.4 million people who voted for Brexit.So far, all in-depth polls show There is little movement on the thorny issue of EU member states.
Those who demanded a referendum to overthrow the referendum still want to join the union. On the other hand, Brexitists basically still believe that it is worthwhile to leave the European Court of Justice and control the borders of the United Kingdom, regardless of the short-term damage caused by our departure from Brussels.
For some time it was not clear how complicated the situation was due to the pandemic. Those who support Britain’s withdrawal from the single market and customs union can hide behind broader data that shows that global trade has been hit — and since the transition period ended in January, the second and third waves of the virus have distorted the big picture. The trade pattern of most exporting countries.
This is not true anymore. There are too many independent reports studying UK trade data to the same conclusion: Brexit is bad for exporters. Not only today and tomorrow, but over a long period of time.
At first glance, an analysis of the latest data shows that the impact of Brexit is relatively small. In May, the UK had a trade surplus for the first time since June 2020, and merchandise exports to the EU almost returned to the level before the epidemic.
But further inspection by consulting firm Pantheon Macroeconomics found that “the damage is more obvious, and Brexit seems to be preventing the UK from fully benefiting from Global trade growth“In terms of a percentage of total EU imports, the UK’s National Bureau of Statistics measures the UK’s share below its 2019 average. “In other words, British exporters have lost market share,” said Pantheon.
It said the products most sensitive to the new trade barriers, such as food and chemicals, performed particularly poorly. More importantly, exports of services in May were still 18% lower than their pre-epidemic levels, especially exports to the European Union, which dragged down the overall data.
As the local chamber of commerce pointed out last week, companies in the Northeast are already healing. Open letter to Boris Johnson. A survey of its “International Trade Members” in May found that 75% of respondents said their finances were hit by the red tape associated with Brexit, while 37.5% of respondents said their UK and EU The trade volume has been affected.
James Ramsbotham, chief executive of the Chamber of Commerce, said Johnson needs to understand that the UK “newly discovered powers that run counter to European standards may pay a price” and that the Northeast will bear the heaviest burden, which is “the region most dependent on European trade”.
William Bain, the head of trade policy at the British Chamber of Commerce, compiled a chart of 1,400 trade barriers with the EU. He said that even for the most dedicated and entrepreneurial exporters, these barriers can change their lives. Difficult.
In addition to the rules set by Brussels, each EU country can impose its own rules on foreign companies. Need to apply for a license, prohibit the purchase of real estate and apply for expensive visas. These are common obstacles that British workers and companies must overcome to work and provide services in member states.
If the stories of these struggling exporters cannot convince the skeptics, then consulting firm Ernst & Young will regularly update the latest information on the level of business investment entering the UK from abroad.
The investment of some foreign companies has remained stable or growing. For example, food manufacturing depends on foreign investment. Foreign investment projects have increased from 35 in 2015 to 64 in 2020. Our enthusiasm for online shopping and express delivery means that foreign logistics projects have increased from 71 to 94 during this period.
However, although the UK accounted for almost 13% of all European foreign direct investment (FDI) in manufacturing in 2015, it has now fallen to just over 8%, and in the same five years, investment in automobiles and transportation has dropped from 83%. Reduced to 40 by 2020. These investments have made the UK the core of the European factory network. no longer.
When exports account for 30% of the UK’s GDP and UK-based exporters are struggling to make progress in a booming trade world, this heralds more poor economic health in the country next year and in the future.
