Manufacturers urge Government to ease difficulties with new trading environment

Britain’s manufacturers are calling on the Government to help them ease continued difficulties with the new trading environment, which has ramped up cost, caused import and export delays and is hampering smooth trade as companies struggle to recover from the COVID pandemic.

Make UK research has shown that while 96% of companies have faced challenges with the new trading environment since the start of the year, just over a third of small and medium-sized companies are still reporting ongoing challenges with customs paperwork and processes, with clearance across customs borders posing the greatest difficulty.

New rules to prove the origin of a product were one of the last elements of the trade deal to become known, leaving manufacturers little time to prepare or understand the detail. Almost two in five manufacturers see Rules of Origin as a key priority for further discussion with the EU, particularly looking to find a solution to the issue of goods that cross the UK/EU border multiple times during production as part of an integrated supply chain process.

The UK has taken back control over legislation, including employment regulation, environment and climate change and critically product legislation and rules. This is a growing concern for manufacturers who have already seen regulation around medical devices change in the EU in May, but UK law has not kept up, leaving UK companies at risk of not being compliant. Companies fear this ‘divergence by inertia’ will spread, and it is likely EU rule changes will also impact machinery and chemicals as time goes on.

Another ticking time bomb awaits as business travel starts to unlock post-COVID, as mobility between the UK and EU remains largely untested. A third of manufacturers surveyed said the Government should look to improve mobility between the UK and EU to allow companies to deliver the service areas of their contracts. While Make UK welcomed the provisions for short term business visits, including aftersales care such as installation and servicing of equipment, this needs to be extended to cover contractors which many manufacturers use to carry out these activities across the EU.

Commenting on the research, Stephen Phipson, CEO Make UK, said: “It is clear that much of the trade and cooperation agreement needs to be worked on further to smooth out continuing difficulties for both UK and EU companies in several areas including customs, mobility, legislation and standards.