What we need is an ‘exporter support scheme’ to help British companies.
Extending the customs easements at the UK border until the end of 2021 is a confession by the Government that their border operating model is not working. Imports from the EU are still over 30% down compared to last year and businesses struggle to deal with the new red tape.
The Government bought themselves some time now with extending the customs easements and it needs to rework major parts of the border operating model so that it supports businesses with UK/EU trade, not block it.
But the customs easements and changes to the UK border model only help EU companies importing to the UK. It does not help British companies with their exports to the EU. The problems for British exporters are the complex rules of the EU customs border. But the EU won’t change their rules for the UK as it operates its customs border with a lot of other third countries.
UK exports to the EU are now over 40% down compared to last year. The truth is that British exporters were not prepared for the EU customs union exit. The new red tape for exports to the EU will stay permanently, unless the UK re-joins the customs union at some point in the future. British exporters will have to adapt and deal with the new rules now or they simply won’t be able to sell to the EU anymore.
The Government advised British companies last month to step up and deal with the new EU customs rules if they wish to trade with their EU customers. In many cases this will require UK companies to set up a local presence in the EU, which is expensive and burdensome.
Changing the UK customer border rules is necessary, but only helps EU importers. To help British exporters, we need more guidance from the Government to overcome the complex EU rules. We have been calling for an ‘exporter support scheme’ for some time now, which appears to be overdue for being implemented.