Post-Brexit UK Trade: An Update
[Published: 28 November 2022]
Prof Jun Du, Dr Emine Satoglu and Dr Oleksandr Shepotylo have published a new insight paper entitled ‘Post- Brexit on UK Trade: An Update’.
This insight paper provides three insights on UK trade post-Brexit. First, we update Du and Shepotylo’s (2022) assessment of the TCA impact on UK trade. By using data up to 2022Q1, we show that the negative, large, and statistically significant impact of the TCA on UK exports has persisted and even slightly deepened into 2022. This highlights the continuing export challenges that UK firms have faced since the TCA was put in force and underscores the need to systemically think about the UK’s post-Brexit trade policy. Second, unlike exports, the negative impact of the TCA on imports has been subsiding. Although there is a confluence of many factors that might explain the Brexit imports puzzle, it appears to be more of a teething problem. The reduction in import bottlenecks might help exports to rebound, although the rising costs of imports are likely to offset the effect of that recovery. Third, the UK has experienced a significant contraction in its trading capacity in terms of the varieties of goods being exported to the EU due to the TCA. An estimated loss of 42% of product varieties over the 15 months since Brexit, combined with an increased concentration of export values to fewer products, signify some serious long-term concerns about the UK’s future exporting and productivity.
Media Coverage:
The Financial Times, The Independent, Institute of Export & International Trade, SNP, The London Economic, Phys Org, World News, MSN, Today UK News, News Break, Yahoo! UK, The Scotsman, Edinburgh News and Yahoo! UK