UK: Manufacturers warn Brexit changes will add to custom delays & soaring costs in 2022

As new custom rules of Brexit are set to go into effect, manufacturing firms in Britain have warned that it will add to the skyrocketing costs that industries in Britain are already facing. This comes alongside pre-existing concerns over custom delays and red tape and is expected to turn into one of the biggest challenges in 2022.

According to a survey conducted by Make UK on its 228 member manufacturing units, cited by The Guardian, Brexit has moderately and significantly hampered business in the one-year transition period.

Most of the firms from the said survey raised concerns over additional damages to custom delays and import checks. As per reports, separate regulatory regimes in the UK and European Union (EU) nations will also add to the manufacturing costs in addition to the reduced access to migrant workers.

"It is clear from these figures that Brexit and the global Covid-19 pandemic have had a scarring effect on the mentality of many businesses, which are traumatised by the ongoing delays and disruptions to their supply chains," Make UK survey report said, as quoted by the Guardian.

As per another survey by BDO, an accountancy firm and the Centre for Economics and Business Research, business optimism among the manufacturing firm executives had grown. However, the enthusiasm was undermined by the aftermath of the UK's final departure from EU.

In December, as the firms were facing the sweeping impact of the new COVID strain, Omicron, the output and growth also dwindled among UK-based businesses. "Ongoing uncertainty around Omicron is providing a further blow to UK businesses which have already battled a string of supply chain issues, the threat of further void restrictions and inflationary pressures this past year," said Kaley Crossthwaite, a partner at accountants BDO, as quoted by The Guardian.

UK could face food shortage after new Brexit rules

With the new customs rules of Brexit on food products entering the UK from EU taking effect from January 1, the British Frozen Food Federation indicated that January will be a difficult month as the UK could face food shortages. It is pertinent to mention that UK is reliant on EU imports for fresh fruits and vegetables.

At least 90% lettuce and 85% tomatoes come from EU national, which will be largely disrupted due to substantial delays at ports due to inadequate planning to secure steady supply chain flow, said Richard Harrow, chief executive of the British Frozen Food Federation, as quoted by AP.

(Image: Unsplash/AP)