English and Welsh factories are seeing a decreasing proportion of their goods being sold to the EU, hinting at a possible shift in trade patterns post-Brexit, according to new research.
Manufacturers in England and Wales have seen their share of exports to the EU decline since 2019, according to analysis from Make UK/BDO.
The report found 52% of goods produced in the UK were shipped to the EU in 2022, up from 50% in 2019, but noted that most English and Welsh regions saw this number fall.
Scotland and Northern Ireland increased their share of manufacturing exports to the EU, fuelling the overall increase across the country as a whole.
Boost to Scotland and NI
Northern Ireland’s factories increased their dependency on EU trade, with their share of locally produced good being exported to the EU rising to 64% in 2022, up from 59% in 2019; It was the region within the UK that had the highest proportion of its manufactured goods being exported to the EU.
Scotland also recorded an increase of 9% in the same time period, going from 50% to 59%.
The Guardian reports that the UK-wide rise was attributable to an increase in tariff-free trading between Northern Ireland and the Republic of Ireland, without which the overall share would “also be on a downward trend”.
England
Increased quantities of Scottish oil and gas being shipped to Europe, in response to the Russian invasion of Ukraine, was also cited as a reason for the nation’s increased share of EU trade.
EU exports from the north-west of England dropped 2% as a proportion of its overall trade, down to 50%, and the West Midlands also saw a drop of 1% to 45%.
The only English regions seeing a rise were the South East, which includes London, and the East.
Trade shift
As reported by The Manufacturer, the figures indicate a potential structural shift in the UK’s trade patterns.
Verity Davidge, director of policy at Make UK, said:
“Given the EU remains the most important market for manufacturers, efforts still need to be made to improve the existing agreement with the EU to reduce barriers to trade.
“However, UK trade patterns may be undergoing a gradual shift, with many companies continuing to look for opportunities in other markets. This has significant implications for export support and government policy must reflect this.”
The Times noted that the share of goods exports to both Asia/Australasia and North America has remained relatively stable at about 16%since 2010 and suggested that this indicated that the UK’s manufacturers are looking at opportunities outside their traditional markets.
