Before the end of 2021, the UK Government announced its new ‘Made in the UK, Sold to the World’ campaign which came with a 12-point plan to help boost exports in the UK and help UK businesses hit £1 trillion in exports by 2030. This campaign is a direct response to the difficulties faced by UK businesses to export out of the UK following Brexit and COVID-19.
Companies (such as those exporting haggis) have noticed an increasing difficulty in exporting goods out from the UK to the EU following the changes to regulations around rules of origin. It is unlikely that the new strategy will be able to have any real impact before Burns Night this year, resulting in haggis suppliers continuing to face difficulty in exporting to the EU; however, it is hoped that the new strategy will tackle key exporting issues and restore successful trading from the UK to the EU and the rest of the world.
The Food and Drink Federation (FDF) issued two statistic-based publications in 2021 showing that exports of food and drink to the EU fell drastically. This includes the UK’s top 10 products exported to the EU over the years, such as whisky (down by 32.3%), chocolate (down by 36.9%), milk and cream (down by more than 90%) and cheese (down by 66%). Certain UK imports from the EU also fell between 2019 and 2021 with vegetables down by 13.9%, fruit down by 15.7% and wine down by 20%.
There was a clear trend that many businesses suffered, and continue to suffer, as a result of a cumulation of factors including COVID-19, stockpiling, Brexit and the implementation of the UK’s Trade Agreement with the EU.
In particular, the Trade Agreement with the EU resulted in many businesses struggling to understand the new regime with little cohesion on the interpretation of rules. Many businesses are also no longer able to rely on zero-tariffs due to the change in rules relating to preferential treatment. This has not only resulted in increased costs for businesses but also creates delays at customs due to the requirements for specific documentation.
Made in the UK, Sold to the World
In order to help combat the drastic fall in UK exports, the UK Government announced a 12-point plan which includes the creation of a support service dedicated to exporters, financial support for SMEs, government-to-government partnerships, increased campaigns and piloting UK tradeshow programmes.
For UK businesses, the creation of the Export Support Service (ESS) is a welcome mechanism as it is designed to:
- provide guidance and support for businesses;
- target specific difficulties which businesses are facing; and
- promote opportunities across the UK.
In particular, the ESS is designed to act as a single point of contract for exporters to provide guidance on areas such as exporting to new markets, paperwork needed to sell goods abroad and rules for specific countries to which products are being sold.
It is anticipated that these changes will help reduce the difficulties created following the lack of clarity following the introduction of the Trade Agreement with the EU. In addition, through greater clarity of the rules, it is expected that this will reduce delays at customs which ultimately will lower costs for businesses.
However, it is notable that the new strategy will not be a comprehensive solution for all businesses who are currently suffering. For example, the new strategy does not address the issues faced by businesses which are suffering from the loss of preferential treatment, or assist businesses which are subject to more onerous conditions under the Trade Agreement. Therefore, businesses, such as haggis producers, may find that while they understand the rules better, the rules themselves are not favourable compared to previous rules on exports prior to Brexit.
The full strategy is available here.
How can we help?
Our dedicated Food & Drink team can assist you with understanding requirements for exporting and provide guidance on the new assistance available by the UK Government. If you have any queries in relation to importing or exporting, please get in touch with Euan Duncan, Head of our Food & Drink team.
This article was co-written by Haris Saleem, Trainee Solicitor.