Brexit deal made it difficult for UK firms, businesses to grow - survey

More than three-quarters of British companies have reported that the trade agreement between the European Union and Britain has made it difficult for them to increase sales and grow their business, a British Chambers of Commerce survey showed.

The survey of more than 1,168 businesses, which was published on Wednesday, showed significant challenges for UK firms trying to use the Trade and Cooperation Agreement (TCA) that was signed in 2020 to allow tariff-free trade with the European Union once Brexit took effect.

More than three-quarters (77 percent) of British firms said the TCA is not enabling their business to grow or increase sales.

"It has coincided with the start of a forecast lengthy period of recession and economic and supply chain shocks caused by the war in Ukraine," the report said.

The survey also showed that as many as 42 percent of product lines previously exported from the UK to the EU were stopped during the first 15 months of the TCA.

"In 2022, UK goods exports to the EU recovered through the end of Q1 and into Q2, but by the end of Q3, goods exports (which had been inflated by fuel exports to the EU) had tipped once again into negative territory, and services exports remained flat," it noted.

About 92 percent of the businesses surveyed were small and medium enterprises.

New rules, new hurdles

In addition, as many as 56 percent of the companies are having difficulty adapting to the new rules for trading goods, while 45 percent said they are having problems dealing with the new rules for trading services.

Around 44 percent of the firms also said they are having difficulties obtaining visas for staff.

"Brexit has been the biggest ever imposition of bureaucracy on business. Simple importing of parts to fix broken machines or raw materials from the EU have become a major time-consuming nightmare for small businesses," a manufacturer in the East Midlands was quoted as saying in the BCC survey report.

The report also said these problems remain "unresolvable" due to the current UK political context.

"This is especially relevant given the current state of EU-UK relations, mostly caused by the continued disagreements over the Protocol on Ireland/Northern Ireland, which worsened through 2022 and remain uncertain at the year’s end."

In its proposals to increase UK-EU trade, the BCC, which carries out Britain's biggest quarterly survey of businesses, has recommended the creation of a supplementary deal with the EU and for the UK to make side deals with the EU and member states to allow UK firms to travel for longer and work in Europe, among others.

Britain formally withdrew from the European Union on January 31, 2020.

READ MORE: Brexit saga ends with EU trade deal vote