Britain’s vaccine rollout has triggered a wave of optimism among businesses as they look to new growth opportunities after the pandemic but Brexit concerns still linger. Business confidence is now at its highest level since the middle of 2018 as the government steps up its efforts to vaccinate the adult population by the summer.
While the pandemic remains the main source of negative impact on business performance over the next 12 months the vaccine rollout is touted as the biggest growth driver. More than three-fifths of businesses are confident about their growth over the next three months, according to Santander’s latest trade barometer.
It is the first survey since the UK’s departure from the European Union and while Brexit concerns have fallen to their lowest ever level, 38 per cent of firms say the deal will make trade with the EU more time-consuming.
Almost a quarter of UK businesses said higher costs and bureaucracy will prohibit their business from continuing to trade in current markets. It supports figures which showed UK exports to the EU plummeted in January after the transition period came to an end.
The double whammy of Brexit and the pandemic has meant businesses are shifting their priorities. Despite Brexit costs, UK businesses are more minded to consider overseas expansion and North America has overtaken the EU as the region seen as offering the best trade prospects.
Head of international and transactional banking at Santander, John Carroll said: “While hopes are high for domestic demand fuelling the post-pandemic recovery, there’s also a big opportunity for British firms in overseas markets,”
He added: “International trade can play an important role in helping UK businesses to emerge from the pandemic successfully and get back to growth.” The pandemic has presented opportunities for companies that have pivoted to digital with 27 per cent reporting they expect new business to arise from tech.
Meanwhile, data suggests that the impact of the UK’s departure from the EU might not be as bad as feared for UK-French trade despite some issues at the start of the year, with trade between the two countries bouncing back to close to pre-pandemic levels last month.
Data from French customs officials showed that after a plunge in January, imports from the UK rose to 107 per cent of pre-Covid levels in March, with exports at 96 per cent. The reported figures suggest the business may now be adapting to the dual challenges presented by the UK’s new trading relationship with the bloc and the pandemic.
They are a marked improvement in January when imports from the UK fell to about 80 per cent of pre-pandemic levels.
That was part of a wider slump of UK-EU trade, which saw exports and imports from the bloc fall 40.7 per cent and 28.8 per cent respectively. Prime Minister, Boris Johnson’s UK-EU trade adviser, David Frost, said that the fall was a result of a “unique combination of factors”.
Despite some disruption at customs chokepoints at the beginning of the year, trade between the EU and its former member has continued relatively incident-free since January. However, not all the most recent figures made such encouraging reading.
German exports to the United Kingdom fell by 12.2 per cent on the year in February and imports slumped 26.9 per cent, the German Federal Statistics Office said. Germany is the UK’s biggest EU trading partner. And Portugal said that imports from the UK had more than halved in the same month, with exports also down 15 per cent. (The writer is our foreign correspondent based in the UK)
Britain’s vaccine rollout has triggered a wave of optimism among businesses as they look to new growth opportunities after the pandemic but Brexit concerns still linger. Business confidence is now at its highest level since the middle of 2018 as the government steps up its efforts to vaccinate the adult population by the summer.
While the pandemic remains the main source of negative impact on business performance over the next 12 months the vaccine rollout is touted as the biggest growth driver. More than three fifths of businesses are confident about their growth over the next three months, according to Santander’s latest trade barometer.
It is the first survey since the UK’s departure from the European Union and while Brexit concerns have fallen to their lowest ever level, 38 per cent of firms say the deal will make trade with the EU more time consuming.
Almost a quarter of UK businesses said higher costs and bureaucracy will prohibit their business from continuing to trade in current markets. It supports figures which showed UK exports to the EU plummeted in January after the transition period came to an end.
The double whammy of Brexit and the pandemic has meant businesses are shifting their priorities. Despite Brexit costs UK businesses are more minded to consider overseas expansion and North America has overtaken the EU as the region seen as offering best trade prospects.
Head of international and transactional banking at Santander, John Carroll said: “While hopes are high for domestic demand fuelling the post-pandemic recovery, there’s also a big opportunity for British firms in overseas markets,”
He added: “International trade can play an important role in helping UK businesses to emerge from the pandemic successfully and get back to growth.” The pandemic has presented opportunities for companies that have pivoted to digital with 27 per cent reporting they expect new business to arise from tech.
Meanwhile, data suggests that the impact of the UK’s departure from the EU might not be as bad as feared for UK-French trade despite some issues at the start of the year, with trade between the two countries bouncing back to close to pre-pandemic levels last month.
Data from French customs officials showed that after a plunge in January, imports from the UK rose to 107 per cent of pre-Covid levels in March, with exports at 96 per cent. The reported figures, suggest the business may now be adapting to the dual challenges presented by the UK’s new trading relationship with the bloc and the pandemic.
They are a marked improvement on January, when imports from the UK fell to about 80 per cent of pre-pandemic levels.
That was part of a wider slump of UK-EU trade, which saw exports and imports from the bloc fall 40.7 per cent and 28.8 per cent respectively. Prime Minister, Boris Johnson’s UK-EU trade adviser, David Frost, said that the fall was a result of a “unique combination of factors”.
Despite some disruption at customs chokepoints at the beginning of the year, trade between the EU and its former member has continued relatively incident-free since January. However, not all the most recent figures made such encouraging reading.
German exports to the United Kingdom fell by 12.2 per cent on the year in February and imports slumped 26.9 per cent, the German Federal Statistics Office said. Germany is the UK’s biggest EU trading partner. And Portugal said that imports from the UK had more than halved in the same month, with exports also down 15 per cent.
(The writer is our foreign correspondent based in the UK)
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