Study indicates two years of Brexit costing UK USD34 billion in trade
Date
12/19/2024 6:17:07 AM
(MENAFN) Britain's exit from the European Union has led to an estimated $34 billion in lost trade over the first two years under the EU-UK Trade and Cooperation Agreement (TCA), according to a new report from the Center for Economic Performance (CEP) at the London School of Economics. The study highlights that small and medium-sized enterprises (SMEs) were hit hardest, with around 14% of UK firms that previously exported to the EU ceasing trade with the bloc following the agreement's implementation in January 2021.
The research, which analyzed data from over 100,000 companies, found that UK goods exports dropped by 6.4% in 2022 compared to pre-Brexit projections, with exports to the EU experiencing a sharper decline of 13.2%. This was largely due to the trade barriers introduced by the TCA, including customs checks, paperwork, and regulatory compliance requirements. While larger businesses have been able to navigate these challenges, smaller companies have struggled due to a lack of resources and expertise.
Imports from the EU also saw a decline, though more modest at 3.1%, with many UK importers seeking alternatives outside the EU. Despite the impact being less severe than the 15% reduction initially predicted by the Office for Budget Responsibility, the long-term consequences for UK trade remain uncertain. As the UK government prepares for upcoming negotiations with the EU to revise the TCA, the report underscores the ongoing disruptions Brexit has caused, particularly for industries like automotive and agriculture.
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