According to Parcelhero, new figures from the ONS show 35% of UK importers are struggling at borders and Northern Ireland trade is collapsing.
The latest Office for National Statistics (ONS) economy figures show that businesses are reporting spiralling Brexit challenges, with soaring problems at customs. Doubt has also been cast on the viability of the Northern Ireland protocol, says international delivery expert ParcelHero, with transport costs, border disruption and customs duties problems soaring in the two-week period between 24th January and 7th February.
ParcelHero’s head of consumer research, David Jinks MILT, says the new figures highlight the full impact of Brexit on businesses: “The ONS report ‘UK exporters and importers increasingly likely to face challenges‘, shows a sharp escalation in Brexit problems,” he explained. “They increased markedly in the two weeks from 25th January to 7th February compared to the preceding fortnight.”
David said the report revealed that 35% of businesses are experiencing import challenges due to disruption at the UK borders, a dramatic increase from the 25% of importers reporting challenges in the previous two weeks. Similarly, 25% of exporters recorded disruption at borders, compared to just 19% reporting disruption in the preceding fortnight.
The number of businesses experiencing export challenges because of a rise in transportation costs increased from 25% in the previous two-week period to 34%. In terms of importing challenges, 30% said they had been affected by a change in transport costs.
26% of businesses experienced exporting challenges because of customs duties or levies, a big jump from the 16% of exporters reporting issues in the previous two-week period. Likewise, 26% experienced importing challenges because of customs fees, compared to 16% in the preceding two weeks.
“Perhaps even more concerning, in terms of both trade and politics, are the escalating problems experienced by those shipping goods to Northern Ireland,” continued David. “The Northern Ireland Protocol is in danger of unraveling entirely if these trends continue. A massive 44% of retailers and wholesalers reported the volume of goods they shipped to Northern Ireland decreased in the latest two-week period, compared to the previous fortnight. 31.5% of manufacturers reported their export volumes to Northern Ireland fell during the latest period. Of all businesses who had sent, or intended to send, goods from Great Britain to Northern Ireland in the last two weeks, 38% reported sending fewer goods.”
David cautioned that these problems will only escalate, as a waiver on customs declarations on parcels sent from the rest of the UK to Northern Ireland runs out on 31st March, and certification requirements on supermarket goods ramp-up in April. He believes that the government urgently needs to renegotiate these deadlines with the EU.
‘It’s not as if these issues were unpredictable,” he points out. “As long ago as 2016, our pre-referendum report, ‘Delivering Brexit: The true cost of leaving the EU‘, predicted SMEs would face Brexit costs of around £163k in the first year and a typical rise of 30% on the price of items purchased in the EU that had components originating outside Europe.”
The 2016 report is still available to read here.