Sunday, February 13, 2022
Brexit bites
AS we start to come out of the pandemic, the appalling impact of Brexit is starting to hit home. The Guardian reports that official figures, marking the first full year since Brexit, have found that UK exports of goods to the EU have fallen by £20bn compared with the last period of stable trade with Europe.
The paper says that numbers released on Friday by the Office for National Statistics showed that the combined impact of the pandemic and Britain’s exit from the single market caused a 12% fall in exports between January and December last year compared with 2018:
Highlighting the disproportionate impact of leaving the EU, exports to the rest of the world excluding the 27-nation bloc dropped by a much smaller £10bn, or about 6% compared with 2018 levels.
The ONS compared trade performance against figures from three years ago because that was the last year before distortions caused by firms stockpiling ahead of Brexit deadlines and the spread of Covid-19.
Despite the disruption, the EU remains the UK’s largest trading partner. However, for the first time since comparable records began in 1997, the UK now spends more importing goods from the rest of the world than it does from the EU.
UK goods imported from the EU were down almost 17%, or about £45bn, compared with 2018. In comparison, imports from the rest of the world increased by almost 13%, or about £28bn.
These figures underline Jonathan Freedland's argument in yesterday's Guardian that Brexit has inflicted great losses on this country; that the supposed offsets for those losses don’t offset them at all; and that there are next to no “opportunities” worthy of the name. Brexit is a rank failure:
The evidence of the hurt is in abundant supply. On Wednesday, the public accounts committee reported on the “clear increase in costs, paperwork and border delays” that Brexit has imposed on UK businesses. The next day it was the turn of the Office for National Statistics, whose business survey found that more than half of the UK’s importers and exporters now cite additional paperwork and higher transportation costs as problems, with those two issues their biggest headaches by a wide margin. The phone-in programmes hum with British entrepreneurs, plenty of them leave voters, now driven to despair, forced to spend precious, exhausting hours filling in forms they never used to have to fill in and paying costs they never used to have to pay.
Ignore the talk of the greatest growth since the second world war: that’s just a function of the economy having collapsed so badly in 2020. Note instead the Bank of England’s forecast of 1.25% growth in 2023, falling to just 1% in 2024. David Smith, economics editor of the Sunday Times and no remoaner fanatic, puts that down partly to Covid but partly to the “adverse fiscal consequences of leaving the EU”, which left the country “with a budget hole that has had to be filled with higher taxes. We now have a high-tax economy strangled by red tape and hampered by trade restrictions.”
The people who led us off this cliff continue to pretend that none of this is happening. In a facepalm moment in the Commons this week, the pro-Brexit MP for Dover, Natalie Elphicke, complained about the “miles of traffic jams” besetting her constituency. Those are because of the laborious checks and delays that now confront lorries coming into the port, but Elphicke insisted the jams were “not because of Brexit but because of Brussels bureaucracy”. Like many Brexiters, she is outraged that when you leave the EU, the EU treats you as if you’ve left the EU.
Wherever you look, it’s the same picture. For all the fur-hat photo-ops in Moscow, Britain is no more than a bit player in the current crisis over Ukraine. Before Brexit, the UK was one of the three decisive members in an economic bloc that stood between the US and China as the most powerful in the world. Outside the EU, and having broken our commitment on overseas aid and forsaken the soft power that came with it, the UK is struggling to stay relevant.
Meanwhile, the delicate constitutional machinery that kept Northern Ireland at peace has been smashed. At the same time, those other parts of the UK that once relied on EU cash now face a government that has broken its manifesto promise to plug the gap previously filled by Brussels funds. That deprives Wales, which voted to leave the EU, of close to £1bn over the next three years.
It is a damning verdict, but one that rings true.
The paper says that numbers released on Friday by the Office for National Statistics showed that the combined impact of the pandemic and Britain’s exit from the single market caused a 12% fall in exports between January and December last year compared with 2018:
Highlighting the disproportionate impact of leaving the EU, exports to the rest of the world excluding the 27-nation bloc dropped by a much smaller £10bn, or about 6% compared with 2018 levels.
The ONS compared trade performance against figures from three years ago because that was the last year before distortions caused by firms stockpiling ahead of Brexit deadlines and the spread of Covid-19.
Despite the disruption, the EU remains the UK’s largest trading partner. However, for the first time since comparable records began in 1997, the UK now spends more importing goods from the rest of the world than it does from the EU.
UK goods imported from the EU were down almost 17%, or about £45bn, compared with 2018. In comparison, imports from the rest of the world increased by almost 13%, or about £28bn.
These figures underline Jonathan Freedland's argument in yesterday's Guardian that Brexit has inflicted great losses on this country; that the supposed offsets for those losses don’t offset them at all; and that there are next to no “opportunities” worthy of the name. Brexit is a rank failure:
The evidence of the hurt is in abundant supply. On Wednesday, the public accounts committee reported on the “clear increase in costs, paperwork and border delays” that Brexit has imposed on UK businesses. The next day it was the turn of the Office for National Statistics, whose business survey found that more than half of the UK’s importers and exporters now cite additional paperwork and higher transportation costs as problems, with those two issues their biggest headaches by a wide margin. The phone-in programmes hum with British entrepreneurs, plenty of them leave voters, now driven to despair, forced to spend precious, exhausting hours filling in forms they never used to have to fill in and paying costs they never used to have to pay.
Ignore the talk of the greatest growth since the second world war: that’s just a function of the economy having collapsed so badly in 2020. Note instead the Bank of England’s forecast of 1.25% growth in 2023, falling to just 1% in 2024. David Smith, economics editor of the Sunday Times and no remoaner fanatic, puts that down partly to Covid but partly to the “adverse fiscal consequences of leaving the EU”, which left the country “with a budget hole that has had to be filled with higher taxes. We now have a high-tax economy strangled by red tape and hampered by trade restrictions.”
The people who led us off this cliff continue to pretend that none of this is happening. In a facepalm moment in the Commons this week, the pro-Brexit MP for Dover, Natalie Elphicke, complained about the “miles of traffic jams” besetting her constituency. Those are because of the laborious checks and delays that now confront lorries coming into the port, but Elphicke insisted the jams were “not because of Brexit but because of Brussels bureaucracy”. Like many Brexiters, she is outraged that when you leave the EU, the EU treats you as if you’ve left the EU.
Wherever you look, it’s the same picture. For all the fur-hat photo-ops in Moscow, Britain is no more than a bit player in the current crisis over Ukraine. Before Brexit, the UK was one of the three decisive members in an economic bloc that stood between the US and China as the most powerful in the world. Outside the EU, and having broken our commitment on overseas aid and forsaken the soft power that came with it, the UK is struggling to stay relevant.
Meanwhile, the delicate constitutional machinery that kept Northern Ireland at peace has been smashed. At the same time, those other parts of the UK that once relied on EU cash now face a government that has broken its manifesto promise to plug the gap previously filled by Brussels funds. That deprives Wales, which voted to leave the EU, of close to £1bn over the next three years.
It is a damning verdict, but one that rings true.
