LSE Report: UK faces double whammy from new red tape

New research by the London School of Economics reports that EU-UK imports have fallen by 25% and the number of export relationships has fallen by a third since the EU-UK trade deal was introduced in January 2021.

The findings have furthered concerns about the impact that post-Brexit barriers to trade are having on the UK’s long-term economic performance with the research suggesting that the harm it is doing to smaller businesses in the UK will damage future trade growth.

The report comes after a recent session of the UK Trade and Business Commission heard that increased export and import barriers for SMEs is also increasing costs for consumers during a cost of living crisis.

In response, Co-chair of the UK Trade and Business Commission, Hilary Benn MP said,

“British SMEs trying to export to the EU continue to be the main casualties of additional costs and red tape, while our own evidence suggests that new import checks are increasing costs for consumers at home. 

“This morning, the Prime Minister has briefed that he wants to tackle the cost of living crisis but unless he takes steps like opening a successor to the Brexit Support Fund and reducing these barriers to trade that he has imposed, the UK will be hit by a double whammy of artificially higher costs and, as this research makes clear, lost growth.”