The Davis Downside Dossier

Quoting ONS figures for the thee months to December 2023, Bloomberg reports the UK is exporting fewer goods than before Brexit. The volume of exports of goods was around 15% below the level 2018. That’s in contrast to services exports which have continued to rise after surpassing pre-pandemic peaks. The UK’s trade balance is said to have worsened since 2010, with falling EU trade weighing on progress made to boost business with the rest of the world.

A delicatessen in north London has lost 37 suppliers from the EU since Britain left the single market in 2021, and the owner of Panzer's, David Josephs, fears more will quit after the UK introduces new border checks start coming into force this month. Mr Josephs says Brexit has been a disaster for his business: "The government says there won't be any disruption. I guarantee there will be. We already have some meat suppliers who are saying it's becoming debatable as to whether or not it's economically viable to supply the UK."

Trade bodies have said fresh confusion about when the post-Brexit border checks would begin were “incredibly challenging” for business planning, while others said serious questions remained about the government’s readiness for the regime, according to The Guardian. Businesses have described Britain’s border plans as being in “complete disarray” after the FT revealed the introduction of some checks on EU imports will again be delayed.

The FT reports that many small and medium-sized importers of food and plants from the EU will face “punitive monthly charges” when post-Brexit border checks come into force at the end of this month. William Bain, the head of trade policy at the British Chambers of Commerce claims that owners of corner shops, cafés and local delis would face an “explosion in costs” with some businesses paying “tens of thousands of pounds” extra each month.

The founder of The Fold, an upmarket women’s workwear brand, says Brexit has made running an international business so complicated “you need a PhD in customs” to make sense of the new rules.” Polly McMaster said the impact of the UK’s withdrawal from the EU in January 2021 has led to the company spending “hundreds of thousands” on consultants to help resolve the situation. She claimed the main issue is caused by the “origins of goods” rules that require complex paperwork to be filled out for each step of a garment’s creation.

A new report by the Nuffield Trust health think tank has warned that drug shortages are a “new normal” in the UK and are being made worse by Brexit. The trust says: “A clear picture emerged of underlying fragilities at a global and UK level, not fundamentally rooted in Brexit but exacerbated by it in some specific ways, especially through some companies removing the UK from their supply chains.” Since leaving the EU 2020, the UK has faced “constantly elevated medicines shortages” including for key treatments such as antibiotics and epilepsy drugs, the report said.

The Guardian reports that garden centres and nurseries in the UK are stockpiling European plants to limit potential shortages when the new Brexit checks are introduced later this month, after concerns were raised about new border posts (BCPs) being ready to deal with the volume of deliveries. The Horticultural Trade Association (HTA) said many of its members had been increasing orders of plants in recent weeks. Continental suppliers have announced that they will hold back some orders for up to three weeks after the checks begin because of fears BCPs could be overwhelmed.

Figures from the Irish Central Statistics Office (CSO) suggest that Brexit is having an impact on the annual level of Irish exports to Great Britain which declined to €1.2bn in February, a 5% drop compared to 2023. Janette Maxwell, director of tax at Grant Thornton, said the decline was “unsurprising” following the introduction of Brexit-induced customs controls at the end of January. Ms Maxwell said the CSO figures highlighted “difficulties experienced by Irish traders when selling goods” into Britain. The figures are expected to fall further when a “Brexit border tax on plant and animal products will be applied from the end of April.”

Food Manufacture magazine says that phase 2 of the new 'Not for EU' labelling rules, which begins in October, will apply to goods imported directly into GB from the EU or the rest of world (RoW), or produced by businesses that do not currently trade with NI. All will have to be compliant with the new labelling requirements. It means that EU and global businesses that supply products to GB will be faced with producing a bespoke label purely for the GB market. Food Manufacture asks how with “all this added complexity, can we possibly be seen as an attractive trading partner.”

The owner of a Glasgow cheese shop says her business will be 'eradicated' by new import fees. Starter Culture brings in specialist artisan cheeses from across Europe, but Rachna Dheer says she “cannot afford to absorb the costs." Ms Dheer added: "Brexit was so long ago and the effects are going on and on. There was no thinking behind what impact it was going to have on local people to eat, drink, live. If we close, what is going to go in our place? Another supermarket? Independent and local businesses will be eradicated."

The CEO of the Cold Chain Federation has written to Environment Secretary Steve Barclay calling for a delay in introducing new Brexit import checks due to begin at the end of April. Phil Pluck, said that after UK exporters became subject to new rules in 2021, “many smaller cold-chain UK warehouses and distributors found the administration too onerous and ceased to operate” and he fears the same impact on EU exporters. Nigel Jenney, CEO of the Fresh Produce Consortium, said the government had failed to recognise that importing food was a rapid, overnight process, and that some importers would pay more in fees than the amount they make from shipping food.

With the raising of the minimum salary threshold for a skilled work visa from £26,000 to £38,700, Italian restaurants in London are struggling to find staff post-Brexit, according to The Guardian. The average wage for waiting staff in London in 2024 is £28,000, according to recruitment site Glassdoor. Plaxy Locatelli, who runs Locanda Locatelli in Marylebone said: “It has been an absolute disaster. We’ve been open for 22 years and held on to many of the same staff for a long time. They’re now feeling it’s not worth it in the UK and are deciding to leave after all this time.”

The 77-year old daughter of an Italian now faces various bureaucratic hurdles to obtain an Italian passport to make extended use of a €150,000 two-bedroom Tuscan holiday retreat purchased last year. The retired architect from Edinburgh says her father did not pass on Italian citizenship and she now only has a UK passport. She says obtaining an Italian passport could take up to a decade to resolve.

The Daily Mirror reports that UK holidaymakers are “fuming” about a new rule being introduced by Spain requiring tourists to prove they have at least €113.40 (£97) available every day if they visit the country. It applies to both the mainland, and the Canary and Balearic islands. Spain is concerned about the impact of tourism on its environment and public services. Some Brits have threatened to "boycott" the country.

DUP MP Sammy Wilson has called for Ireland to carry out checks on visitors entering the country to prevent a 'border crisis' with immigrants using the Republic or Northern Ireland to illegally enter the UK. It follows a Home Office admission that it will be "a challenge" to catch people illegally entering the UK from the Republic of Ireland using the Common Travel Area who have not signed up to the new electronic travel authorisation (ETA) scheme.

The Ulster Farmers Union has recently warned that farmers will be unable to absorb the costs of the new EU rules on organic produce. Hence, concerns are now being raised about NI companies becoming uncompetitive when selling into GB. A report in the Belfast Newsletter suggests 14% of the organic eggs sold in Britain for example, come from NI. Baroness Hoey, who campaigned for Brexit but opposes the Windsor Frameworks, has warned that divergence will increase and local farmers will face unfair competition in the UK market.

In a Substack blog post, the chief leader writer at The Times Simon Nixon, argues that Brexit has “wrecked “ the London stock market. He says £100 invested in the FTSE100 in June 2016 is now worth £118 and in the FTSE250, £114. This compares to the same sum invested in the CAC40 (French) at £198; in the Nikkei 225 (Japan) £235: FTSE MIB (Italy) £189 and in the S&P500 index in America it would have grown to £250. London is being de-globalised, he claims, with a net £80 billion being taken out of equities since Brexit.

The former minister for Brexit Opportunities Jacob Rees-Mogg, MP for North East Somerset, has described the extra costs of £2bn to be raised by charging importers for new post-Brexit checks on plant and food products as an “unnecessary act of self-harm that will increase prices in an era of inflation.” Mr Rees-Mogg had claimed in 2017 that Brexit would potentially “reduce people’s food costs by 20%”.

A new report by the business insurer Allianz Trade claims that the new post-Brexit UK border controls coming into force at the end of April will cost British businesses £2bn and help to increase inflation. The new checks, part of the government’s “border target operating model” (Btom), will impact £21bn of food and agricultural product imports adding around 10% to costs in the first year.

A British man and his French wife who moved to France in 2015 after 25 years living and working in the UK cannot now return because they did not have five years of unbroken residency in Britain before Brexit. IT specialist Stephen Kaye, who has Parkinson's disease, said: “My first reaction upon discovering that Carmen did not have an automatic right to return to England was one of disbelief. It did not seem possible that a ‘civilised’ country (the UK) could invent such an outrageous rule.