Trade barriers with the EU in the wake of Brexit have cost UK firms over £2bn in the first half of 2021.
£600m in costs alone have derived from issues surrounding Rules of Origin, where UK firms have to prove that products they’re exporting are over 50% derived from UK or EU components, or face tariffs.
As many businesses are starting to discover, free trade deals are not cost-free for UK firms.
The news comes as the Office for Budget Responsibility reported that leaving the EU would reduce the UK’s potential GDP by 4% long-term – twice the negative effect that the pandemic is likely to have.
Richard Hughes of the OBR commented to the BBC that: “In the long term it is the case that Brexit has a bigger impact than the pandemic.
“We think that the effect of the pandemic will reduce that (GDP) output by a further 2%.”
The OBR also suggested that shifting trading regimes following Brexit have been partly to blame for supply chain issues, which in turn is supporting above-average inflation.