Exports to EU plunged 41pc in post-Brexit trade

LONDON: Exports of UK goods to the European Union dropped by more than two-fifths in January as the Brexit transition period came to an end.

New figures from the Office for National Statistics (ONS) show that overall exports from the UK fell by £5.6 billion – 19.3 per cent.

It was driven by a £5.6 billion, or 40.7 per cent, plunge in exports of goods to the EU, the ONS said. Imports also fell, by £8.9 billion overall (21.6 per cent), while imports from the EU dropped £6.6 billion (28 per cent), the figures show.

The falls in imports and exports are the largest since records began in 1997, the ONS said, as a £200 million – 1.7 per cent – increase in non-EU exports failed to make up for the decline within the bloc.

British Chambers of Commerce (BCC) head of economics Suren Thiru said: “While changes in data collection limit historic comparisons, the significant slump in UK exports of goods to the EU, particularly compared to non-EU trade, provides an ominous indication of the damage being done to post-Brexit trade with the EU by the current border disruption.

“The practical difficulties faced by businesses on the ground go well beyond just teething problems and, with disruption to UK-EU trade flows persisting, trade is likely to be a drag on UK economic growth in the first quarter of 2021.”

A Government spokesman said: “A unique combination of factors, including stockpiling last year, Covid lockdowns across Europe, and businesses adjusting to our new trading relationship, made it inevitable that exports to the EU would be lower this January than last.

“This data does not reflect the overall EU-UK trading relationship post-Brexit and, thanks to the hard work of hauliers and traders, overall freight volumes between the UK and the EU have been back to their normal levels since the start of February.”

Labour’s Rachel Reeves said: “Businesses have been appealing to the Government to start listening to the problems they’ve been facing, but they’ve been left out in the cold.

“The Government must up their ambition here, and take practical action, hand-in-hand with businesses, to build on the limited deal they negotiated with the EU.”

Because the value of imports fell more than exports in January, the trade deficit for the month narrowed by £3.7 billion to £1.9 billion.

UK exports of medicinal and pharmaceutical products to Ireland jumped by 224 per cent in the three months to December, the ONS said.

The export of food and live animals to the EU plummeted by around 64 per cent in January, the figures show, potentially because of strict checks by the EU.

The Scottish Seafood Association has reported that sign-offs on consignments are now taking six times longer than previously.

The EU imposed full customs requirements on exports coming from Great Britain in January; however, the UK decided it did not immediately want to start full controls.