UK exporters think Brexit has done more harm than good

British companies are losing faith in the potential benefits of new free-trade deals as exporters say Brexit has done more harm than good.

Trucks queue to enter the port of Dover in southern England before boarding ferries to Europe. Picture: AFP.

British companies are losing faith in the potential benefits of new free-trade deals, government research shows, as exporters say Brexit has done more harm than good to their overseas sales.

A survey of more than 3000 firms carried out by the Department for Business and Trade found that three out five now think that free-trade deals – including those struck with Australia and New Zealand – will have no impact on their business, including half of all firms exporting.

A YouGov poll for The Times also suggests that the public are increasingly unhappy with the perceived impact of Brexit on the economy. It indicates that 61 per cent of voters think that Britain’s departure from the EU made the country worse off, compared with 10 per cent who think it is better off and 20 per cent who think it made no difference.

A majority, 53 per cent, think that the UK should have a closer relationship with the EU than the present free-trade deal, compared with 22 per cent who are in favour of the relationship.

However, voters have a lack of trust in either party to handle post-Brexit relationships with the EU, with 19 per cent of voters trusting the Conservatives and 17 per cent Labour. The department’s figures show there is a similar pessimism among firms despite pledges by ministers to use Brexit to promote “global Britain” and increase trade with fast-growing economies.

They show that the proportion of UK firms exporting overseas has remained stagnant since 2016 despite pledges to unleash the potential of global Britain.

In 2016, 33 per cent of firms with a turnover of more than £500,000 said that they had exported goods or services in the past 12 months.

Last year that figure stood at just 34 per cent. The number of firms that said they had not exported and did not intend to has remained stuck at about 40 per cent. Even among those firms that did export 40 per cent said that their exports of goods had decreased over the past year. Among service exporters 29 per cent said sales had decreased.

The survey also suggested pessimism about export opportunities despite two new trade deals announced last year with Australia and New Zealand.

In 2017, 73 per cent of firms said there was a lot of demand for UK products and services, a figure which declined to 55 per cent last year. Forty-nine per cent said that since Brexit there had been less global demand for products and services, up from 39 per cent in 2021.

William Bain, head of trade policy at the British Chambers of Commerce, said: “It doesn’t surprise me that companies feel pretty sore about things and that is what our survey data shows as well. But it is also true that we’re in a better place than we were last year and the government has been listening to some of our concerns. A lot of companies do want to export but they need practical assistance with issues like customs declarations … we do need to see clear and sustained progress in the months ahead if firms are going to be able to take advantage of new deals.”

A Department of Business and Trade spokesman said the public supported trade deals and that exports increased to £852bn in the year to the end of June. “Selective use of polling stats only paints half a picture,” he said. “Fifty-eight per cent of these same businesses said there is a lot of opportunity to grow internationally and the majority of companies who are ready to export, or export already, are using our expert support services to grow their business.”

The Times