Brexit: one year on

Brexit has been the biggest political and economic story of the last five years in the UK – and it is not over yet.

The Institute of Export & International Trade (IOE&IT) has conducted a survey over recent weeks to take the temperature of businesses as they look back on the first year after the end of the Transition Period and look forward to the next tranche of changes in the UK’s trading relationship with the EU, which are coming at the start of 2022.

That was the year that was

Overall, a picture emerges of British business having worked hard to get to grips with the changes, and largely succeeding, but lacking confidence and knowledge about what is still to come.

Asked, ‘How confident are you with trading with the EU in a post Brexit environment’? 70% of respondents indicated that they were confident trading with the EU (9.8% being very confident and 59.2% saying quite confident).

Just under two-thirds (64.4%) of businesses surveyed said that they had undertaken additional training to adjust to the new post-Brexit trade rules and processes. 74.7% of businesses have made Brexit related changes to their import and export arrangements.

Many businesses have had to call on external support or hire additional staff to deal with new trade rules and processes. 47.1% had sought external support in the shape of a customs consultant or a freight forwarder. While 21.1% had hired additional staff to deal with the new rules.

However, most worryingly, when asked how confident they are of a trouble-free transition to new import requirements that come into force on 1st January 2022, 50.3% of respondents indicated a lack of confidence (not very confident 34.1% - not confident at all 16.2%). 40% of respondents report some confidence in the process, with only 4.7% being very confident while 36.2% were quite confident.

Marco Forgione, director general of the IOE&IT

Marco Forgione, director general of the IOE&IT said: “The past year has been a period of adaptation for UK businesses engaging in trade with the EU. Confidence in exporting to the EU has grown over the past 12 months, as companies have undertaken more training and education.”

“The IOE&IT has been supporting businesses through this year, delivering technical support, guidance and most importantly training, to ensure British exporters can trade both confidently and compliantly.”

This is illustrated by the IOE&IT technical helpline handling a 379% increase of enquires. The attendance of trade related webinars saw an 80% increase, with over 20,000 delegates and 11,000 students undertaking additional learning and qualifications with the Institute.

However, Mr Forgione recognised that this is just a stage in the transition to a post Brexit trading relationship, and more work needs to be done to get importers up to speed: “As the Brexit timeline moves on, the next crucial date is 1st January 1 2022. The Institute stands ready to support importers implement these new changes and help them navigate them effectively,” he commented.

The shape of things to come

Customs declarations and full import controls will apply to goods entering Great Britain from the EU from 1st January 2022. Any goods passing across the border will need to have a customs declaration completed and accepted by HMRC systems. Goods movements will be risk assessed and goods may undergo physical and documentary checks at an inland border facility.

The UK-EU trade and cooperation agreement (TCA) allows importers to benefit from zero tariffs (or customs duties) on goods, however exporters, need to provide evidence that the goods originate in either the UK or EU (and demonstrate that goods meet the rules of origin) for the zero tariffs to apply. UK exporters do not currently need to hold evidence that goods are eligible for preferential treatment at the time of export; this will change from 1 January 2022.

Aimee Maltman, deputy to the director of academy, at the IOE&IT added: “From 1st January 2022 traders who move goods into Great Britain from the European Union will need to make import declarations at the point of crossing the border and pay any relevant tariffs.

“In essence, this means that the optional easement that the UK Government had released allowing traders to delay declarations for up to 175 days is no longer available. UK importers can make use of the UK and EU trade and cooperation agreement which in turn would reduce those tariffs to zero however, importantly, goods need to comply with the rules of origin for this to apply.”

Institute of Export & International Trade
www.export.org.uk

 

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