UK goods to Germany down 8.5% in further sign of Brexit damage | Germany


Imports of British goods to Germany fell 8.5% last year in the latest signal that additional Brexit costs and red tape are hurting British trade relations.

Britain also slipped out of Germany’s top five trading partners, with the EU’s biggest economy turning to its eurozone neighbors for machine tools, auto parts and components for the aerospace industry.

Germany’s statistical office, Destatis, said UK imports fell in 2021, the first year since the Brexit free trade deal at the end of December 2020, to €32bn (£27bn). .

However, the situation has improved for many of Germany’s other trading partners, which have benefited from a strong increase in sales to Germany.

Total imports of goods into Germany jumped 17.1% during the year to €1.2 billion, partly due to additional costs for imported energy, but also after the easing of restrictions. lockdown restrictions and the deployment of vaccines that spurred the global economic recovery last year.

The increase included a 16.8% increase in imports from Germany’s other European Union members and a 20.8% increase in imports from China.

In December alone, German imports from the UK were down 18.2% year on year, which analysts said was due to a storage rush in December 2020 as businesses braced for potential Brexit disruption.

The EU introduced checks on goods from Britain entering the bloc as soon as the Brexit deal came into force, with experts warning that British businesses were losing their competitiveness.

The value of German goods arriving in Britain also fell. The UK has delayed its checks on incoming goods until 2022. But even so, German exports to the UK fell by 2.6% in 2021, to 65.4 billion euros.

Overall, German exports rose 14% during the year, even as the pandemic continued to disrupt global supply chains.

Destatis said: “Compared to the same month last year, exports to the UK fell by 7.6% to €5 billion in December 2021. Imports from the UK fell 18.2% to 2.6 billion euros.”

Carsten Brzeski, global head of macroeconomics at ING, said trade data showed Brexit had left its mark on German trade.

He said: “When it comes to export destinations, 2021 clearly marks a structural shift, illustrating current themes including reshoring, slowing Chinese growth and different ways to deal with the pandemic.

“Brexit has left its mark on German trade, with the UK removed from the list of the top five trading partners, with German companies exporting more to Austria than to the UK.

“Ahead of the Brexit deal signed in December 2020, many supporters of the vote to leave the EU single market and customs union said the UK’s importance in as Berlin’s trading partner would outweigh further trade frictions.”

In 2020, World Bank figures showed that £49bn of goods were exported to Germany, making Germany the UK’s second largest goods export market after the US.

Sign up for the daily Business Today email or follow Guardian Business on Twitter at @BusinessDesk

For goods imports, Germany was the biggest trading partner with £66.1bn of goods imported in 2020, according to the ONS.

A report released by Parliament’s financial watchdog on Wednesday urged ministers to strike new deals with the EU to facilitate cross-Channel trade.

The Public Accounts Committee has said new EU regulations risk hitting trade when they come into force in September unless port infrastructure is improved.


Comments are closed.