Two in five businesses exporting less to the EU

More than two in five businesses that trade internationally are exporting less to the EU compared with the last five years, new research suggests.
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The Institute of Directors (IoD) said its survey of business leaders revealed that one of the main challenges facing firms is the administrative and cost-related burden from the implementation of new customs arrangements.

In January, 40% of traders found these customs changes challenging, but by March the figure had risen to 44%, said the IoD.

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IoD policy adviser Emma Rowland said: “Over the past year, UK businesses have lost EU clients and experienced a loss in revenue.

New customs arrangements have hit firms trading in the EU  Photo Colm Lenaghan/Pacemaker PressNew customs arrangements have hit firms trading in the EU  Photo Colm Lenaghan/Pacemaker Press
New customs arrangements have hit firms trading in the EU Photo Colm Lenaghan/Pacemaker Press

“EU firms have pulled out of the UK market due to increased trade frictions.

“The UK government needs to work pragmatically with EU leaders to put business first. Restoring confidence on both sides of the Channel in cross-border trade is an urgent business priority.

Traders also need guidance that is clearer, more straightforward and more easily accessible.

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“The UK government should engage further with EU member states to encourage consistency in the application of the TCA (EU–UK Trade and Co-operation Agreement), and further develop targeted support lines and funding for traders.

“The IoD is also calling on the government to monitor its own progress in reducing friction at the border, to enable them to understand and react in real time to the impact on the lived experiences of importers and exporters.”

Anecdotal responses from IoD members included:

l “The main challenges are the duplication of info and work, the lack of co-ordination, the mixed messages from the three main government bodies involved, all leading to delays, red tape, and sometimes loss”;

l “The situation is even more complex with the new regulations in place since January 1. Costs and delivery timeframe have both increased again”;

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l “A key French supplier to our business is finding it increasingly difficult to book hauliers that are willing to bring goods into the UK at a reasonable price; apparently the latest shipment cost twice their estimate but they absorbed it. From now on the excessive costs will be passed on”;

l “Over the course of the past year we have moved all our suppliers to the EU base. When we hav e shipped from the UK we have had to deal with customs, import charges, extra costs, goods getting stopped”.

The data was taken from a targeted survey of more than 150 firms that import and/or export outside the EU.

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