Welsh exports have become more dependent on the EU after Brexit, research shows
Welsh exports have become more dependent on the EU after Brexit, new research has shown.
The EU’s share of Wales’ export market has risen from 58% to 60%, despite a reduced dependence on the EU and opening up export markets with the rest of the world being a stated objective of the Brexit project.
Those who commissioned the research said that it showed that the new Prime Minister needed to stop endangering the UK’s trading relationship with the EU as Boris Johnson had done.
The research by Make UK and business advisory firm BDO suggested that the nations and regions which voted for Brexit had increased their dependence on the EU for manufacturing exports, while the European market remained the overwhelming favoured destination for the sector.
Their report found that half of manufacturing exports went to the EU last year, with Brexit-voting regions including Wales, the North East and the East Midlands all seeing their share increased.
Make UK said the EU remains “by some distance” the most important export destination for UK goods, adding that the new Prime Minister should take immediate steps to renew the trading relationship with the bloc.
Verity Davidge, director of policy at Make UK, said: “Despite the talk of ‘Global Britain’, history shows that geography is always the main determinant of trade.
“The EU was always going to remain the main destination for manufacturers who appear to becoming more, not less, dependent on it as a market.
“As a result, it is vital the Government now takes steps to reset the trading relationship with the bloc and, wherever possible, eases and simplifies trading to boost exports for SMEs (small and medium-sized enterprises) in particular.”
Richard Austin of BDO said: “Manufacturing businesses have done a good job in adapting to new post-Brexit rules for trading with the EU, but ongoing Government support may well be required, particularly for firms at the smaller end of the spectrum.
“Clearly, there are difficult ongoing political issues relating to the Northern Ireland Protocol. However, it’s vitally important that good trading relationships with our European neighbours are maintained to ensure that trade remains as frictionless as possible.
“We also hope to see further progress on free trade deals which could offer new and exciting opportunities for the UK’s manufacturing exporters.”
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