Brexit won’t break Britain’s trading relationships with Europe, study shows
British businesses will continue to have a strong trading relationship with European customers and suppliers despite the Brexit vote, research to be released today suggests.
Of 1,500 business people surveyed, around three quarters currently sell and source goods and services in the EU market, and UK companies will continue to see Europe as a vital trading partner after the UK leaves the European Union, the survey by the British Chambers of Commerce (BCC) shows.
More than a third of businesses (36 per cent) plan on funnelling more resources into exporting to the European market over the next five years, and 18 per cent plan to allocate more resources to sourcing products and services from Europe.
The survey serves as a reminder that it is businesses that trade, not governments, Adam Marshall, director general of the BCC, said.
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"Although the likely outcome of the Brexit negotiations remains unclear, businesses still see Europe as a primary market for both selling and sourcing inputs – even after the UK leaves the EU," he added.
Nearly a third of businesses (31 per cent) said they are looking to export more following the EU referendum, and the majority of respondents (65 per cent) said the EU referendum hasn't changed their strategy for importing.
While 15 per cent are looking to source more internationally, 13 per cent are going the opposite route, which may be a result of the depreciated pound making imports more expensive.
"Looking ahead, businesses want the best possible terms of trade following the Brexit negotiations," Marshall said. "UK firms want tariffs, costly non-tariff barriers, and product standards to be at the top of the government’s agenda for a future EU trade deal."
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Centre for Cities found every UK city, including London, is "critically dependent" on EU markets for exports.
Alexandra Jones, chief executive of Centre for Cities said: "While it’s right to be ambitious about increasing exports to countries such as the US and China, the outcome of EU trade negotiations will have a much bigger impact on places and people up and down the country."
Last week, Theresa May visited the US in a bid to discuss a new post-Brexit trade deal with President Donald Trump.
However, British cities would have to dramatically increase trade with international markets like the US to compensate for a downturn in exports to the EU.
To make up for a 10 per cent decrease in exports to the EU, British cities would have to nearly double exports to China, or increase exports to the US by nearly a third (31 per cent), Centre for Cities said.