QES Q1 2021 Results Reveal GM Traders continue to struggle with new Post Brexit Rules
Subrahmaniam Krishnan-Harihara, Head of Research at Greater Manchester Chamber of Commerce, presented the latest QES results last week. The QES continues to show the impact of Brexit on international trade as traders continue to face challenges in the ability to move goods seamlessly across the border. International trade in services with EU partners has also been impacted, as more companies are realising the restrictions they may now face when delivering services in the EU – from a business visit to short or longer-term assignments.
The survey showed that nearly 80% of internationally active respondents reported that they were having difficulties in fulfilling the new paperwork and compliance requirements imposed by the EU–UK Trade and Cooperation Agreement.
We know it is not only Brexit that has had an impact and many traders are still dealing with the impact of COVID19. According to HMRC, between 2019 and 2020, the North West region saw a decline of 11% and 13% in exports and imports of goods respectively. The largest contractions in exports registered in markets such as North America (24%), Sub-Saharan Africa (21%), and 12% to the EU; and in relation to Imports, Eastern Europe (excluding EU) dropped the most with a 31% contraction, followed by Middle East & North Africa (26%) and Sub-Saharan Africa (19%). Imports from the EU fell by 16%.
The ONS also reported the largest drop in both exports and imports in Q1 2021 since records began. Most companies did stockpile before the end of 2020 and many also consciously decided to stop trading until they had a better understanding of the new requirements. Since then, we have seen trade to start to pick-up, but companies are facing various issues at the border.
The Chamber Team has dealt with more than 500 queries since December last year, supporting businesses through a number of challenges – from rules of origin to new requirements for exporting and importing such as customs declarations to triangular trade and VAT to mention but a few.
The Chamber has also been in regular contact with HMRC and DIT providing feedback on these issues, and we were pleased to hear about the new £20 million funding available to SMEs aimed at helping them adapt to the new rules on trading with the EU. Companies can apply now and will be able to get up to £2,000 to cover the costs of training and professional services.
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