Trade between the UK and the EU fell by nearly a quarter in the first three months after the UK left the EU’s single market, according to data released on Tuesday May 25 by the British Office for National Statistics.
The EU-UK Trade and Cooperation Agreement, which entered into force on January 1, establishes a duty-free, quota-free trade in goods regime between the two parties following the departure of Britain of the European Union.
However, companies now have to deal with customs controls the EU imposed on UK exports on January 1, while the UK has chosen to gradually introduce reciprocal measures until October.
The largest drops in trade were recorded with Ireland and Germany. Exports to Ireland fell 47.3% between December and January, with the largest drops in chemicals, live animals and food. As part of the Brexit deal, customs controls were introduced on all goods transported from Britain to the island of Ireland.
In a statement accompanying the data, the ONS said the data was compared to the same quarter in 2018 as it was “the most recent period in which relatively stable business trends were observed.”
He also acknowledged that it was “difficult to fully disentangle the impact of the coronavirus and leaving the EU on UK and international trade while they still wield influence.”
Imports from Germany, the UK’s largest trading partner in the EU, fell 30.5% or 1.7 billion pounds over the same period.
Brexit Minister David Frost has sought to downplay the long-term impact of exiting the single market, remarking earlier this month that it was “striking that exports of goods to the EU now exceed average levels from 2020 ”.
Ministers also attributed part of the drop in trade volumes to the effects of COVID-19 and storage by UK companies in the EU before the end of the transition period.
Most of the decline was recorded in January when UK exports to the EU fell 40.7% in January compared to December. Since then, trade volumes appear to have started to recover. In March, the ONS found that merchandise trade with the EU rose by £ 1.8 billion compared to February.
However, companies from a wide range of industries have reported difficulties and delays resulting from new controls and bureaucratic requirements.
[Edited by Frédéric Simon]