In a significant development, the United Kingdom and the European Union are poised for a UK-EU reset in their trade relationship. This comes as both parties prepare for an EU-UK Summit scheduled for the first half of 2025. The reset aims to address challenges that have emerged since Brexit and improve economic ties between the two entities.
Current Challenges
Trade Disruption:
- EU plant exporters are turning away from supplying Britain due to “painful” new Brexit border checks, putting long-held trading relationships at “breaking point”.
- The value of UK horticultural industry exports to the EU dropped by 39% in the first six months of 2023 compared to the same period in 2019.
Increased Costs and Delays:
- Physical inspections at UK ports and border crossings have led to costly delays, with each inspection costing around €500 to €1,000.
- Some specialist transporters are withdrawing from the UK market completely due to the new border processes.
- The additional costs and administrative burdens are making trade unviable for many small businesses.
Impact on Supply Chain:
- The UK imports 80% of its flowers and around 70% of its plants through the Netherlands, making these new checks particularly impactful.
- Delays at border posts can lead to quality issues, as demonstrated by an incident where plants were held for 44 hours, causing them to wilt and be rejected by the customer.
Recently, Nick Thomas-Symonds, Minister for European Union Relations, addressed this reset:
“For this Government, our reset with the EU means the UK being safer, more secure and increasingly prosperous. It does not mean hitting rewind. We are not undoing Brexit. There is no opacity over the outcome of the referendum in 2016. Yet, five years on, we can see some of the negative impacts of the current deal emerging here at home, as well as in Europe.
Trade is a clear example. Despite the EU being our largest trading partner, with trade in 2023 worth over £800 billion, we are trading less. Between 2021 and 2023, exports to the EU were down 27 per cent and imported goods down 32 per cent.
The problems are not just economic. Our borders are less secure. The asylum system has been pushed into crisis, with backlogs reaching record levels and costs hitting £5.4 billion in the last financial year, up over a billion pounds on the year before.
We are not cooperating closely enough with the EU on law enforcement to smash the gangs behind the small boats. To make people safer, we must do all we can to strengthen our collective ability to tackle organised crime and work together on illegal migration.”
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