LONDON (REUTERS) – Around 40 per cent of British companies that import and export said the shift to a new trading arrangement with the European Union had made trade more cumbersome last month, a survey showed on Thursday (Feb 4).
The report from HSBC UK and polling firm YouGov showed 40 per cent of importers and 42 per cent of exporters reported a hit from the end of the Brexit transition period.
The findings are in line with other recent surveys that show the British companies struggled with supply chain issues last month, with the shift in trading arrangements exacerbating problems resulting from the Covid-19 pandemic.
“The end of the transition period coupled with the third national lockdown has presented a challenging start to the year for businesses who are desperate to start executing strategies to recover,” said Ian Tandy, head of international trade for HSBC UK.
More than a quarter of the companies reporting an impact cited increased time spent on bureaucracy, HSBC said.
Under a deal struck last month, trade between Britain and the European Union remains free of tariffs and quotas but a new full customs border means goods must be checked and paperwork filled in.
Using a phrase that has angered many business owners, British Prime Minister Boris Johnson described the disruption as “teething problems” which have been exacerbated by the Covid-19 pandemic.
Trade analysts think some of the extra cost and bureaucracy will be permanent. Proponents of Brexit say Britain will benefit in the long run by striking its own trade deals and forming its own regulations outside the EU.
Nearly half of the companies in the HSBC UK survey said they expected to grow over the next 12 months while just under a quarter expect to shrink.
“The message from businesses is that Government needs to continue to deliver trade deals with new markets to help firms reach their growth targets through 2021 and beyond,” Mr Tandy said.
The survey of 1,000 businesses was conducted between Jan 11 and Jan 18.