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The Rt Hon David Jones MP

Latest News > Daily Post article

It was entirely predictable that there would be some disruption to trade between the United Kingdom and the European Union immediately after the end of the transition period on 31st December last year. A political and economic relationship that had prevailed for almost half a century could not be terminated without some consequences.

As it turned out, the predicted chaos did not transpire. On the morning of 1st January, BBC TV News cameras were dispatched to Dover to film the lengthy queues of lorries that would, according to some estimates, stretch for tens of miles to the port. There were, in fact, no such queues; the handling of traffic on both sides of the Channel appears to have been exemplary.

This is not to say that there has not been some impact. January’s trade figures revealed a seasonally adjusted drop of around 40 percent in UK exports to the EU, while imports fell by around 35 percent.

It now appears, however, that the sharp decline in trade with the continent was a temporary phenomenon. Recent figures from France and Germany, two of the UK’s principal trading partners among the 27 EU member states, indicate that bilateral trade rebounded strongly in February. UK exports to Germany rose 55% in February, to a level just 2.9% lower than the average in the second half of 2020. Exports to France rose 27% in the same month, almost back to the average over the same period. Further estimates from the French authorities indicate that the recovery continued in early March.

The decline in January trade may be attributable to a number of factors, including UK stockpiling in late 2020; the impact of France’s travel ban before Christmas; UK exporters being temporarily deterred by new paperwork requirements; and reorientation of UK exports to non-EU destinations. However, February’s resurgence in cross-Channel trade indicates that British businesses are coming to terms with the new trading environment.

Trade with Ireland, too, appears to be returning to something closer to normal. Last week, Stena Lines announced it was increasing the number of sailings between Fishguard and Rosslare from 14 to 24 each week.

Regrettably, however, trade between Great Britain and Northern Ireland continues to be disrupted by the prospect of tariffs and the checks required under the terms of the Trade and Cooperation Agreement (TCA). In response, the Government has unilaterally announced the extension of grace periods to allow for agreement to be reached with the EU on the future operation of the TCA. If that proves impossible, it may be necessary for Article 16 of the TCA to be invoked, providing for safeguard arrangements to avoid further disruption.

That apart, it would appear that, slowly but surely, trade between the UK and the EU is returning to a more stable position. This, perhaps, is unsurprising. Ultimately, if enterprises wish to trade with one another, wherever in the world they are, they will find a means of doing so.

The fact is that governments don’t conduct trade; businesses do.

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