Although initial signals were positive, Brexit is not working yet out as well as hoped for for small and medium – sized enterprises in the UK. A survey carried out by the trade association FSB among small and medium-sized enterprises shows that a quarter of exports have stopped temporarily or even permanently. Apart from an increase in paperwork, this is mainly due to delays at the border.
In some cases, it takes a month for UK goods to be delivered to customers in Europe, while for Brexit it took within a day. Of course, Covid-19 measures also play a role in this.
These messages do not come as a surprise. Prime Minister Johnson had set his hopes for a quick trade deal with the United States. Former President Donald Trump, as an outspoken supporter of Brexit, promised a nice trade deal.
However, the evidence is piling up that Johnson can wait a long time for a trade agreement with the United States. The priorities of US President Joe Biden are to combat the coronavirus pandemic and to boost economic growth at home.
By the way, Biden has some attention for what is happening outside the United States. But Britain is not at the top of the list of priorities. Foreign trade policy focuses on resolving the long-standing subsidy dispute between Airbus and Boeing. The strategic importance of securing the future of aircraft manufacturers – and cutting off Chinese competition – weighs more heavily on Biden.
In the meantime, the deadline for an accelerated procedure from the US, with a strong mandate for the president, to reach a trade agreement with the British has expired. In other words, if further negotiations take place, US Congressmen can table amendments which will then have to be discussed again.
There is a good chance that there will still be a lot to smooth out between the US and the UK, particularly in the areas of food and agriculture. This makes it possible that a trade deal will not be concluded between the two countries until 2024.
While negotiations with the United States are dragging on and British exports are falling, the British pound is skyrocketing. That has everything to do with the vigorous vaccination programme.
More than 30 million British people have already received their first vaccine. The prospect of the economy moving faster than that of the EU has boosted the pound by 6% against the euro in the last three months.
It is questionable whether this increase will continue if it becomes clear how many loose ends there are after Brexit. Because in addition to the challenge of negotiating a good solution for the Irish border, there are also the weak export figures and the lack of an American trade deal.