Recent trade data has left businesses questioning whether Brexit will deliver any potential upside whatsoever to Britain’s floundering economy.
A new poll from the British Chambers of Commerce found that 56 per cent of firms “face difficulties adapting to the new rules for trading goods” with the EU and 77 per cent of firms for which the deal is applicable say “it is not helping them increase sales or grow their business”.
The results showed that 44 per cent of firms surveyed also faced difficulties in getting visas for staff post-Brexit.
The Office for Budget Responsibility (OBR) has called for an “honest dialogue” on improving the UK-EU trading relationship after it too found Brexit had caused a “significant adverse impact” on trade volumes and business relationships between UK and EU firms.
Speaking to CNN, Michael Saunders, a senior adviser at Oxford Economics and former Bank of England official, said: “The UK chose Brexit in a referendum, but the government then chose a particularly hard form of Brexit, which maximized the economic cost.
“Any hope for economic upside from Brexit is pretty much gone.”
Michelle Ovens, the founder of Small Business Britain, echoed his sentiment, saying: “We hear stories every single day from small businesses about the nightmare of forms, transportation, couriers, things getting stuck for weeks at a time… the epic length of the problems is just gobsmacking.
“The way things have panned out in the last two years has been really bad for small businesses.”
One jewelry company called Little Star said that its products had taken off in the Netherlands, but since Brexit, only two of more than 30 of its Dutch customers were prepared to handle the costs and paperwork to obtain stock from the company.
The company is now looking to the United States for growth opportunities.
“Isn’t it mad that we have to look to the other side of the Atlantic to do business, because it’s so difficult to do business with people 30 miles away?” co-founder Rob Walker said.
This echoes an OBR report published earlier this year which found Britain had become a “less trade-intensive economy”, with trade as a share of GDP falling 12 per cent since 2019 – two and a half times more than in any other G7 country.
The decline in exports to non-EU countries could be a sign that UK businesses have become less competitive as they battle higher supply chain costs following Brexit, according to Jun Du, an economics professor at Aston University in Birmingham.
“The UK’s trading ability has been damaged permanently [by Brexit],” Du told CNN. “It doesn’t mean it can’t recover, but it’s been set back for a number of years.”