3 Years of Brexit… It’s been three years since the United Kingdom and the European Union formally implemented Brexit. Two years since the UK completely withdrew itself from the EU. With that, the UK also let go of some benefits it had while in the group.
The imports and exports of the UK have gone through some fluctuations, and so does its economy. A few factors such as the pandemic of COVID-19, the rebound of trading activities and industrial work contributed to the ups and downs for the up-down hill of the UK. We will look into the UK’s trade, following the pre-pandemic, pandemic and post-pandemic periods.
UK’s Trade – Pre-Pandemic
The UK’s trade in the pre-pandemic years, the time period when the pandemic didn’t obliterate the global economy and trade from its usual track, registered significant trade values showing growth, especially the exports. After Brexit, both the import and export values were different.
The below-shown UK trade data features the yearly import and export values for the UK. The time period follows the year from 2010 to 2019, showing UK’s trade in the past decade. Analysing the values, we can observe that trade values were nearly similar each year.
The growth in the past decade for the UK’s trade with the rest of the world registered heavy fluctuations, and more considerably in the export values. The highest growth in imports was recorded in 2011 (14.3%), and so does the growth of exports in the same year (22.58%).
Trade With The EU
In the bilateral relationship with the EU, the UK is on friction after Brexit. It is no doubt to say that since the commencement of the Brexit proposal, both parties have been in disagreement. Hence, the trade of the UK with the EU has been in fluctuations since then.
The UK has availed benefits of being in the EU, the largest bloc that gave trading advantages such as no import duties or quotas in trade with member states, and clear tariff rules for the UK in trade with the countries worldwide. That all changed after the formal exit of Britain from the EU.
The below-shown data features the yearly import and export values for the UK’s trade with the EU. The time period follows from 2015 to 2021 to register the trends since the Brexit proposal in 2016. The import and export values have received fluctuations in the shown years. However…
The growth rate of imports has gone down much more than the growth of exports, which grew considerably. One positive point that comes out is the trade balance which has significantly narrowed, but that also brings the negative—it is because the values have fallen frequently.
The recent trade between the UK and the EU shows a much poorer state as the values have gone smaller. Both the import and export values fell considerably, starting from the third quarter of 2021 to the latest available figure, i.e., the third quarter of 2022.
The trade deficit has further narrowed, with a negative impact on the growth rate of the import and export values. The growth rate in the imports is much in the negative range than the growth rate of the exports, as only Q3-2022 recorded a downfall in the exports by a mere percentile of -1.4%.
The growth rate recorded in both the import and export shows that—while the exports from the UK to the EU grew significantly, the imports in the UK from the EU grew at no significant rate (not more than 2%), recording a high negative growth rate in Q3-2022 by a percentile of 12.27%. This shows that goods from the EU are in lower demand in the UK.
The UK is part of the G7 group of countries, which are considered to be seven of the world’s advanced economies. The list of member countries of the G7 group includes Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States of America.
Due to the blow of the pandemic, the G7 countries were transformed into economies striving to push the possibility of economic growth to fall—down in the ground. While all countries were struggling due to the pandemic, the UK suffered multiple blows.
There were the changes after Brexit, the COVID-19 pandemic outbreak, the rising global inflation rate, labour shortages, and shortages of the HGV drivers that contributed to an unstable state of the economy in the UK, causing heavy fluctuations in the UK’s trade.
The below-shown trade dataset below features the yearly import values of the G7 countries from 2019 to 2021. The trend begins in the pre-pandemic year (2019), followed by the year of the pandemic outbreak (2020), and the year later the outbreak of COVID-19 (2021).
The imports from majorly developed countries such as the USA, Germany, and Japan are higher than the rest of the countries. However, calculating the growth rate of each country for 2021, the UK had the lowest growth rate, despite having higher values than Canada, France, and Italy.
The following is the growth rate of imports from all the G7 countries in 2021 – Canada (21.1%), France (23.2%), Germany (21.1%), Italy (30.6%), Japan (21.7%), United Kingdom (8.5%), and the United States of America (22.03%).
The export dataset below features the yearly values of the G7 countries from 2019 to 2021. The data covers the three time periods – pre-pandemic (2019), pandemic (2022), and post-pandemic (2021).
The growth rate of the exports by the G7 countries in 2021 for the shown data are as follows: Canada (29.2%), France (19.6%), Germany (17.8%), Italy (20.6%), Japan (18.1%), the United Kingdom (18.9%), and the United States of America (23.0%).
The growth rate for exports from the UK in 2021 has recorded impressive growth, compared to the growth rate of imports, as shown earlier. The UK also registered much higher growth than the rates of other countries such as Germany, Japan, and France.
UK’s Trade, Now…
The UK’s imports to the EU have decreased following the period of Brexit and in its aftermath. While we observed from the study of the datasets shown so far that imports of the UK have no significant growth, the exports on the other hand, both globally and with the EU have increased.
The growth rate in the exports of the UK has shown that while the trade values have fluctuated and even fallen considerably each year, the demand for British exports has not diminished. The trade benefits the UK had with the EU are not there, but the UK’s trade might rebound.
The experts are claiming that the UK might have received several blows in one succession, leading to a downgrade in the UK’s economical and financial status, but taking small steps in the progression of things will help the UK in the long run, being a separate sovereign nation.
Consistent efforts in setting up trade agreements with countries and driving businesses forward while providing employment opportunities to all sorts of people will bring fruitful results for the UK in the long run, driving significant growth in the economy and the UK’s trade and investment.