Brexit: David Williamson discusses the fallout of leaving the EU
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Since the UK’s official departure from the EU in January 2021, the Government has sought to guide the country down an increasingly rocky path. The country came dangerously close to crashing out of the bloc without a deal, but was narrowly saved by the December 2020 Trade and Cooperation Agreement (TCA). The document sought to outline the post-Brexit trade relationship, but it failed to prevent the process from damaging the country altogether.
Did Brexit hit British trade?
Mr Rees-Mogg has taken to his new role with a healthy dose of optimism, praising the Brexit vote and downplaying its negatives.
Speaking on February 17, he claimed the UK’s withdrawal from the EU was “already a success”, adding evidence that it harmed trade was “few and far between”.
In reality, evidence is steadily mounting that Brexit has caused sustained damage to British trading prospects.
And the most compelling figures came from the Government’s Office for National Statistics (ONS).
In a release just one day before Mr Rees-Mogg’s comments, the department outlined a shrinking export landscape with the bloc.
Over the 20 months following Brexit, British exports to EU nations shrunk by £20 billion, with a notable 12 percent dip between January and December 2021.
The ONS cited new trade barriers, red tape and supply chain disruption.
The new Brexit opportunities secretary blamed the difficulties on Covid, claiming the pandemic demonstrably hampered trade worldwide since 2020.
He claimed the pandemic ignited a “global trade issue” countries must now correct.
But to assuage any doubt, British exporters have detailed their Brexit-specific hardships.
A survey from the British Chambers of Commerce (BCC) of 1,000 exporters found most had struggled since the UK and EU parted ways.
A total of 710 (71 percent) said the Government’s negotiated TCA was not helping them.
And 54 percent said it was not “enabling their business to grow or increase sales”.
Only eight percent of the firms surveyed said their business had grown, and 12 percent said the TCA was helping them.
BCC trade policy lead William Bain said the findings showed smaller businesses had taken the brunt of the withdrawal and exposed “issues with the EU trade deal that need to be improved”.
Have new UK deals helped replace lost trade?
Mr Rees-Mogg could be correct in both of his assertions if the new trade deals negotiated by the Government replaced lost income.
But, so far, the most celebrated deals represent a feeble chunk of British trade.
None of the three deals negotiated outside of the TCA represented more than one percent of the UK’s trading potential.
The first, negotiated with Japan in October 2020, was hailed as a game-changer for tariffs, but amounts to 0.07 percent of the trade lost with the EU.
The agreement between the UK and Australia contributed another 0.08 percent by Government reckoning.
Britain will only add 0.2 percent to its trade thanks to an “agreement in principle” with New Zealand ratified in late 2021.
The ONS data added to the increasingly dire picture as it showed trade with other nations has fallen alongside trade with the EU.
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