LONDON, Feb. 16 (Xinhua) — The full impact of Brexit will not be felt until the COVID-19 pandemic is brought to a halt, as current travel restrictions have failed to broadly reveal the disruptions caused by Brexit, a British expert told Xinhua in a recent interview.
According to Rajneesh Narula, the John H. Dunning Chair of International Business Regulation at the Henley Business School, University of Reading, Brexit currently pales in comparison to the pandemic and that travel restrictions mean it is still difficult to measure how much Brexit will disrupt.
“I think that if it hadn’t been for the coronavirus, we would have seen much more traffic being blocked,” Narula told Xinhua.
International attention on COVID-19 has meant that issues with Brexit have been largely muted.
“Everyone in Europe and the world is more concerned over whether you’ve got coronavirus, than whether you’re smuggling or you don’t have the right immigration paperwork, so I think we’re not seeing that yet,” he said.
Despite not seeing the queues of lorries many believed would form due to paperwork disruption, there have been headlines that suggested Brexit is impacting Britain.
According to a recent report by the Road Haulage Association, a British trade body dedicated to the road transport industry, the volume of exports going through British ports to the European Union (EU) fell by 68 percent in January year-on-year.
The organization also found that 65 to 75 percent of vehicles arriving from the EU were returning to the regional bloc empty. This was due to a lack of goods and delays in Britain, and because some British companies had stopped exporting to the continent, according to Narula.
For the general public, the effects of Brexit have still not been majorly felt due to the impact of the coronavirus. But experts like Narula believe that everyday changes are just around the corner — and small businesses are set to be hit the worst.
“We will see prices rising…Any sensible businessperson stockpiled before January 2021. And all the companies that had supply chains that depended upon imports, have planned for this already to a great extent,” Narula said.
Narula said he also believes that big companies have the resources to find alternative ways like exporting goods to countries like Australia, for which they always have the in-house expertise.
But Narula fears that those small businesses, the ones who relied on EU exports, could face dire consequences.
“It’s the people who only exported to the EU, that now suddenly have to go and learn all these new rules, buy the computers necessary, install the software, get the experts, or get the in-house team of people to fill in these forms which are normal things in this situation. So we don’t see this immediately,” he said. “The cost is simply something that they may already have absorbed. But we will see it’s coming into 5 to 10 percent of price increases slowly. Which currently the big companies can absorb but the small companies cannot.”
Since Brexit, some experts have described the Britain-EU ties as “frosty” — there have been issues from both sides regarding fish, diplomats and the Northern Ireland protocol.
Britain’s chief Brexit negotiator David Frost has said the relationship had been “more than bumpy” and more “problematic” than he had hoped.
British Cabinet Office Minister Michael Gove compared it to a bumpy start to a flight which would eventually smooth as time went on — highlighting that they were teething problems.
But Narula said that it’s more to do with the “thin” deal that was agreed.
“I think the term ‘teething problems’ implies that the issues are temporary. The challenges of this very, very thin Brexit, this very, very limited agreement are now becoming obvious,” Narula said.
“The reality is what they negotiated and agreed to, the experts have been talking about for four years now, I certainly have been talking about it for four years, that this will cause all kinds of problems, and these problems will be permanent,” he said, adding that the British government has not yet realized that these problems are not about to go away.
According to Narula, although people will come to terms with the paperwork and permit changes, these problems will not go away. Instead, people will get used to these delays which will have a knock-on effect on the Britain-EU relationship.
But compared to the issues, both economic and political, caused by the coronavirus, Brexit pales in comparison. As more people begin to travel when restrictions ease, and more goods flow back and forth, Britain will likely feel the extent of the impact of the Brexit deal agreed, Narula said.
These are the problems that are being overlooked due to the pandemic, said Narula.
“There are these new small little niggles which are popping up but nobody actually notices that because again, we’re all sitting there waiting for news on coronavirus. Everybody wants to know the death rates and nobody’s coming to the UK,” he said.
The EU and Britain announced on Dec. 24, 2020 that they had reached an agreement that will govern bilateral trade and security relationship starting from Jan. 1, 2021 after the end of the Brexit transition period.
The deal, which came after nine months of arduous negotiations between Britain and the EU, is the biggest bilateral trade deal signed by either side, covering trade worth around 668 billion pounds (about 929.4 billion U.S. dollars).
The EU is Britain’s largest trading partner. Britain is the EU’s third largest trading partner in goods, following China and the United States. Enditem