Considering an impending Brexit, the United Kingdom needs to reach its own bilateral agreements with countries that grant preferences to the European Union (EU) nations to maintain preferential market access, according to the United Nations Conference on Trade and Development (UNCTAD), which said a no-deal Brexit will result in UK export losses of at least $16 billion.
That would represent nearly 7 per cent loss of overall UK exports to the EU and most of the losses in the EU market would be concentrated in motor vehicles ($5 billion), animal products ($2 billion) and apparel and textiles (around $2 billion), a new research report by UNCTAD said.Considering an impending Brexit, the United Kingdom needs to reach its own bilateral agreements with countries that grant preferences to the European Union nations to maintain preferential market access, according to the United Nations Conference on Trade and Development, which said a no-deal Brexit will result in UK export losses of at least $16 billion.#
Although roll-over trade deals have been agreed with several countries, about 20 per cent of non-EU exports of the United Kingdom are at risk of facing higher tariffs from countries such as Turkey, South Africa, Canada and Mexico, the report said.
If these agreements are not concluded by exit day, it would cost the UK economy almost $2 billion in exports. Sectors such as apparel, textiles, motor vehicles and processed food products would face higher tariffs, with losses as high as $750 million in the motor vehicles sector.
This comes at a time when the EU is concluding several agreements with various important partners, like Viet Nam and MERCOSUR countries. These agreements, if not matched by equivalent agreements by the UK, will result in additional losses for UK exporters.
UNCTAD cautions that these losses would be much greater because of non-tariff measures, border controls and consequent disruption of existing UK-EU production networks. (DS)
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