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Sharp fall recorded in UK's post-Brexit trade figures

By EARLE GALE in London | China Daily Global | Updated: 2024-03-04 09:35

The Elizabeth Tower, more commonly known as Big Ben, and the Houses of Parliament are lit up by morning sun in London, Britain, Feb 5, 2024. [Photo/Agencies]

The United Kingdom is importing and exporting significantly less than it did before it left the European Union, according to analysis by the Financial Times newspaper.

The FT reached the conclusion after crunching data published on Friday by the UK's official information agency, the Office for National Statistics, or ONS.

The paper said the data shows goods trade fell during the five years between 2018 and 2023 at the fastest five-year rate on record, with imports slumping by 3.8 percent and exports crashing by 12.4 percent.

Experts said the nation's exit from the EU, known as Brexit, which was completed when it pulled out of the bloc's single market and customs union on Dec 31, 2020, was clearly the major reason for the decline.

Emily Fry, an economist at the Resolution Foundation think-tank, said most recent economic data has been muddied by the impact of the novel coronavirus pandemic and by fast-rising energy prices linked to the Russia-Ukraine conflict, but that the import/export slowdown over the five-year period illuminated by the analysis of the ONS data was a "big sign" Brexit was largely to blame.

"A clear implication of this (data) is that the new trade barriers that were put in place by Brexit are having an effect on trade," she told the Financial Times.

John Springford, deputy director of the Centre for European Reform think-tank, told the paper other major economies had fared better during the same period, despite also being impacted by the pandemic and high energy prices.

"The UK's weak trade performance is unusual among advanced economies," he said. "The obvious culprit is Brexit."

And the UK economy's poor performance in goods trading was further exposed in the latest report from the nation's official spending watchdog, the Office for Budget Responsibility, which said trade intensity, which is the share of the economy made up of imports and exports, was 1.7 percent smaller in 2023 than in 2019, which contrasted poorly with the average across the rest of the G7, where it was 1.9 percent larger.

The UK's Chancellor of the Exchequer Jeremy Hunt responded to concern about the economy on the BBC's Sunday with Laura Kuenssberg program by insisting the UK was on track to quickly rebound from recent challenges.

"People … will know that we have been through a very difficult period and that the government has a clear plan for the economy that is creating jobs, bringing investments into the UK, growing faster than similar European countries," he said.

Hunt said he will unveil measures to boost economic activity in his spring budget on Wednesday.

"The UK needs a long-term approach," he said. "That's what you'll see from what I will announce in the budget."

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