In just one month of post-Brexit trading, British logistics expert Jon Swallow has seen exports dive, prices rise, and customers so desperate that he is practically offering a counseling service.
Swallow is one of thousands of freight forwarders and customs brokers based around Britain’s biggest ports who have described the overnight introduction of a full customs border as akin to the country placing economic sanctions on itself.
Britain’s New Year’s Eve departure from the European Union’s orbit after 47 years of membership means exporters must now provide customs and safety declarations, health checks, and rules of origin details to trade with its biggest partner.
“We are now at a disadvantage to people trading within the EU,” Swallow, a co-director of Jordon Freight, told Reuters in his office next to the vast cranes that tower over Felixstowe docks, Britain’s biggest container port, on the southeast coast of England.
“We’re a very fast-paced business, but now we’re just like walking through mud. There’s just paperwork everywhere.”
Prime Minister Boris Johnson, the face of the Brexit campaign, argued that a more nimble Britain would be able to trade globally if it cast off the shackles of what he said was an overly bureaucratic EU.
But those companies that trade goods between Britain and the bloc are paying a price, particularly small firms. While the EU applied full checks on goods entering from Britain, the UK is phasing in its own customs rules for imports over 6 months.
Previously Swallow’s firm, which moves up to 10,000 truck loads across Europe a year, would have handled an equal measure of imports and exports. In January his exports have all but disappeared and the price of bringing goods in has jumped.
He said many EU drivers were adding 400 pounds ($550) to the cost of driving into Britain so they were covered if they returned without any goods. The industry estimates up to half of the trucks going back to the EU are empty.
“We have calls daily at the moment with people, desperate,” Swallow said. “They need to get their goods moved before the buyer decides to go somewhere else. [But] it’s too much. They just can’t comprehend all that needs to happen.”
As Swallow was speaking, a member of staff was slowly talking a customer through the steps now required, including producing commercial invoices, a packing list, an export accompanying document, a goods movement reference, and more.
Make UK, the manufacturing trade body, said 60% of 189 companies it surveyed say they have suffered “significant disruption” despite having prepared themselves for Brexit.
The government, which had warned that 7,000 trucks could be held in queues if traders were not ready, is working to help smaller firms adapt. Johnson acknowledged the teething problems but said there will be benefits for trade in the long term.
Swallow said bigger firms had generally performed better by throwing people and money at the problem. He is now worried about how companies will fare with full import checks.
“The game has changed,” he said, adding that UK Plc had been based on the free flowing movement of goods. “This is a hard Brexit, this is as hard as you can get without no deal. And the consequence of that is, there’s just a lot to do.” – Rappler.com