Slower than expected export growth to non-EU markets is creating added pressure for a barrier-free Brexit deal according to a new report from the EEF.
Based on a survey of 291 manufacturing exporters conducted in March, the report – Global Trade – Run Aground or Structurally Sound – says that many export destinations are already not as open to trade as they were before the financial crisis and that this is impacting on UK export performance.
According to the findings, world trade volumes are more than 20 per cent below pre-crisis trend levels after nearly a decade, and the UK’s average export growth in the post-crisis period is around a quarter of that in the previous 12 years.
The situation is particularly acute in key emerging markets, where protectionist policies implemented in the wake of the financial crisis continue to impact UK trade.
For instance, one in six exporters to China has seen their trade affected by Chinese government intervention to support local businesses, whilst one in five exporters to Brazil have experienced a reduction in trade finance. What’s more, 10 per cent of companies selling to the US experienced an increase in tariffs.
Against this backdrop, EEF argues that it is doubly essential that the UK government ensures barrier-free access to the EU as part of any deal on Brexit. 47 per cent of those surveyed said that they don’t want to lose the advantages of low tariffs, whilst 42 per cent cited concerns over efficient export procedures in our trade with the EU.
Commenting on the report, EEF’s chief economist Lee Hopley said: “Exports remain fundamental to the performance of UK industry and the economy overall. In recent years, however…the pace of world trade has been held back not just by weak demand but by an increase in protectionism leaving manufacturers facing increasingly complex hurdles in overseas markets.”
“Industrial strategy must create the competitive conditions for companies exporting from the UK, whilst ensuring tariff-free access to trade with our biggest and nearest market and helping deliver future trade liberalisation will be key to the UK’s future trading success.”
Words like chickens, home and roost start to enter my thinking.
White clown -there when the water and the flour are thrown-up but sadly missing when they come down again. I told you so-and we did. Off-shore island? -self-imposed stupidity- worst decision ever made by an apparently intelligent nation? We are a knowledge based economy (so the Right wishes) not a manufacturing one. wait until the lights go out….
Is that enough bile for the moment?
“There’s not a single British company among them – it’s because we’ve got nothing left to sell them. The UK (Thatcher) opted out of manufacturing – presumably, acting as all Tories have ever done. to reduce the power of the Unions and collectives and hence that of the Labour Party. There are no British companies left to help.”
Comment from Sir Dick Evans: former CEO of B Ae (Thatcher’s favourite capitalist after the Al Jamarah fighter-plane deal in Saudi Arabia) commenting on the weakness/failure of UK firms to invest in/supply one of the ‘-stans’ in Central Asia.
I can claim a small part of his success! When he was about 16, (and I was 18) as his Head of House [Derby] and Platoon Sergeant at the Royal Masonic School, I used to make him double-on-the-spot with his rifle above his head for having dirty brasses and smudged Blanco on his belt and anklets! Where do I send my bill for education and other services to the Nation’s leaders.
The UK’s exports to the EU have fallen steadily over the last 20 years as 600,000 manufacturing industry jobs have been replaced by (zero-hours) service industry slavery. This amounts to a reduction of about £ 11 b / year of exports.
The root cause of the collapse of industry in the UK has been governmental policies since Thatcher saw that asset-stripping generated a quick buck for the financiers.
The EEF have no basis to claim expertise on this area and they have contributed to the demise of industry. Their continuing opposition to Brexit and the negotiations is not commendable.
The usual cowardly, lazy and ignorant pro-EU drivel.
Firstly, tariffs would only be those allowed under WTO rules, which are very low, and their effect on UK exports has been wiped out by the fall in the pound. The cheaper pound means that even if tariffs are applied, our exports will still be cheaper than they were and therefore more competitive.
As for other non-tariff barriers on exports to the EU, these would be no greater than those on exports anywhere else. Given that companies currently cope with these administrative procedures for their exports around the world, they can easily cope with them when exporting to the EU.
And if tariffs are applied to our exports to the EU, this will mean that tariffs will also be applied to EU exports to the UK. Combined with the increase in value in the euro this will make UK-manufactured products much more competitive in the domestic market, allowing manufacturing companies to expand both their output volume and their product range in order to substitute imports.
We are endebted to our brave, energetic, informed and, above all, modest commenters.
What you’re talking about is substantial administrative procedures on 44 per cent of the UK’s trade. To say that industry can ‘easily cope’ with that as if nothing has changed is, frankly, ludicrous. And to call the UK’s manufacturers’ organisation ‘lazy and cowardly’ for wishing to avoid such a scenario is beyond ludicrous.
It seems that the editors believe that the EEF represent UK Engineering and engineers, they have never done this as they are a Federation of Engineers Employers (EEF). They are part of the de-industrialising policy that has denuded the UK over the last 20 or so years.
Employment has transferred from the UK to the EU in many sectors due to the lower cost of laying off workers in the UK compared with almost anywhere else in the EU. To make matters worse it is more economic in the UK to invest in property than manufacturing things, ergo prices of property increase faster than the economy grows.