A growing number of UK retailers and wholesalers are finding their ability to import and export is challenged as a result of transport costs, customs duties and disruption at the border, official figures suggest. The figures from the Office for National Statistics (ONS) suggest challenges are most acutely felt between Great Britain and Northern Ireland, where customs declarations and checks are now in place as part of the Northern Ireland Protocol, which came into force alongside the EU/UK post-Brexit free trade agreement. Goods at risk of entering the EU single market via Northern Ireland have to pay EU tariffs, where relevant.
Just over a third (34%) of businesses questioned for the ONS Business Impact of Coronavirus Survey between January 25 and February 7 and that said they had previously exported or imported goods in the last year, said transport costs had led to challenges exporting their goods compared to normal for the time of year, while 30% reported an impact on importing. That’s up from 25% who said they were having trouble exporting in the ONS’ previous wave of the research carried out at the beginning of January, and 28% who cited importing difficulties because of transport costs.
Customs levies and duties presented an export challenge for 26% (up from 16% in early Jan), and an import challenge for 26% (from 16%). Disruption at the UK borders had an impact for 25% (19%) of those exporting and for 35% of those importing (25%).
Asked whether they were now sending more or less goods from Great Britain to Northern Ireland, 38% said they were sending fewer – including 44% of retailers and wholesale businesses and 35.1% of manufacturers. Almost half (49.6%) of all businesses said they were sending the same amount – falling to 43.1% among retailers and wholesalers. Some 2.1% those in the retail and wholesale category say they have stopped sending goods to Northern Ireland altogether.
David Jinks, head of consumer research, at ParcelHero, says the figures highlight the full impact of Brexit on businesses. And he adds: “Perhaps even more concerning, in terms of both trade and politics, are the escalating problems experienced by those shipping goods to Northern Ireland. The Northern Ireland Protocol is in danger of unraveling entirely if these trends continue.”
Jinks says: “These problems will only escalate as a waiver on customs declarations on parcels sent from the rest of the United Kingdom to Northern Ireland runs out on March 31, and certification requirements ramp-up on supermarket goods in April. The government urgently needs to renegotiate these deadlines with the EU.”
The government has launched a Trader Support Service for those sending goods between Great Britain and Northern Ireland and there is also a Movement Assistance Scheme for those sending animals and plans to Northern Ireland.
Last week, half of exporters responding to a British Chambers of Commerce survey said they were having difficulties adapting to the new rules for trade with European Union countries – while a third of customers responding to an Eskenzi PR & Marketing study said they had started to avoid buying from EU retailers.