Is the Deal with Europe any good?

Brexit celebration

Brexit has reshaped the UK's economic landscape, introducing both opportunities and challenges across various sectors. While new trade agreements have opened doors to global markets, many industries continue to grapple with the complexities of post-Brexit trade dynamics.

Food and Agriculture: Navigating New Trade Routes

The UK's food industry has seen a mix of outcomes. A recent agreement with the EU has eased border checks for plant and animal products, reducing delays and costs for exporters. This development is expected to revive trade relationships and improve supply chain efficiency, according to News outlets like The Times, BBC News, The Scottish Sun and Reuters. However, the fishing sector feels sidelined, as the deal grants EU vessels access to UK waters for 12 more years, a move criticised by industry leaders.

Manufacturing and Retail: Facing Export Challenges

Manufacturers, particularly in the automotive sector, have faced increased tariffs and regulatory hurdles, impacting exports to the EU. The Trump tariffs have eased the pain of the automotive sector. Retailers have also been affected; for instance, UK clothing exports to the EU dropped from £7.4 billion in 2019 to £2.7 billion in 2023, due to heightened export and logistics costs. This is according to the Investment Monitor and the CBI, this drop is a significant one.

Digital and Financial Services: Expanding Horizons

The UK's digital and financial sectors have leveraged Brexit to explore new markets. Joining the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) has opened avenues in fast-growing economies, potentially increasing UK trade by £4.9 billion annually. Additionally, the UK has signed digital trade agreements with countries like Singapore and New Zealand, promoting innovation and cooperation.

Agriculture

Challenges: Regulatory Divergence and Labour Shortages

Post-Brexit, UK businesses must navigate dual regulatory systems, especially in sectors like pharmaceuticals and agriculture, leading to increased compliance costs. Labour shortages have also intensified, particularly in agriculture and hospitality, due to new immigration policies and visa requirements.

Government Support: Fuelling Business Growth

To mitigate these challenges, the UK government has introduced Growth Deals, providing funds to local enterprises for projects that stimulate economic development. These initiatives aim to enhance infrastructure, foster innovation, and create job opportunities across regions.

In summary, Brexit is not all bad news as some would believe. While Brexit has presented hurdles for UK businesses, it has also offered opportunities to diversify trade and innovate. Strategic government support and adaptive business practices are crucial for navigating this new economic terrain. This is why understanding your financial needs is important. Do you need to borrow for the short term or something a bit longer? Contact us, we can help you access funds to help your business either expand or survive!