Daily Archives: February 1, 2022

Two years after Brexit formally took effect on 31 January 2020, and a year since the UKs exit from the single market and customs union, we can attempt a provisional economic stocktake for both sides.

Nearly 52% of UK voters supported Brexit in the 2016 referendum. Nearly 100% of citizens elsewhere in the bloc were shocked by the result, and the first concern was that Brexit could mark the unravelling of the whole European project. That did not happen: indeed, quite the opposite. Even in the most Eurosceptic countries there was an increase in support for the European Union, a sort of closing of the ranks. There was a clear risk that the EU would become disunited in the buildup to Brexit. But again, it did not happen. All countries gave a strong mandate to the European Commission, and stood united.

Today, British politics appears increasingly folded in on itself, and the British economy is arguably less outward-looking than before the referendum. Countless questions remain unresolved with the commission, and mutual trust between London and Brussels has long since collapsed.

From the EU, the drama of the Brexit negotiations was watched with mixed feelings. Initial regret shifted to a desire to limit the damage. Some economic opportunities to fill the gaps left by the UK opened up. Brexit was clearly going to be a loss for everyone, but far greater for the UK than for any continental European economy.

The negative impact on trade, so far, is substantial for the UK. The Centre for European Reform recently estimated that there has been an 11.2% negative impact on trade as a result of Brexit. The UK share of world trade has fallen by a further 15% compared to pre-referendum projections.

Assessing the impact of Brexit on the EU presents a challenge, as macro-economic data is contaminated by the pandemic shock. However, digging into the details of trade flows, there has been a noticeable negative effect on some countries, sectors and firms. This has been especially sizeable for small producers who used to have unbounded single market access to the UK. Now, the extra paperwork puts off firms that lack the critical mass to absorb the extra fixed costs of handling non-EU trade procedures. Over time, the situation may well improve, but some companies have already given up. British consumers have paid the price, EU consumers far less.

A more precise picture of the geographical and sectoral composition will emerge once EU funds to compensate countries for the impact of Brexit are distributed.

Since 2016, the flow of EU workers to the UK has been in decline. That process accelerated last year, causing major imbalances in hospitality, agriculture, transport and healthcare, but also in some highly qualified jobs. The corresponding impact in the EU is a greater pool of labour in some countries and less of a brain drain, which increases unemployment but over time becomes a positive supply-side phenomenon. Again, while the impact is sizeable for the UK, it is very much diluted in continental Europe.

Although the impact of Brexit on the City of London is not yet significant, the possibility of maintaining an undisputed dominant position in increasingly integrated European financial markets has been jeopardised. On the margins, London financial job openings have moved to continental Europe, and some firms have relocated.

The historically Eurosceptic wing of the Conservative party wanted Brexit to deliver more freedom from what was perceived as the unnecessary constraints and bureaucratic burdens imposed by Brussels. A minority ultra-liberal wing naively dreamt of an even more open, deregulated, low-tax environment to increase economic dynamism and transform the UK into a Singapore-like haven. That raised fears in the EU of unfair competition through access to the single market, especially given the uncooperative approach to negotiations chosen by the UK government. Again though, these risks have by and large not materialised and concerns are dissipating.

The illusion of giving a boost to the UK economy with a reduction in taxation has clashed with the new needs for public spending for healthcare, the fight against the climate crisis, infrastructure investments, and the various electoral promises to the point of forcing the government to raise taxes. Instead of diverging, policies in the UK and the EU look increasingly alike.

Finally, there are non-tangible effects. In the past, the UK government has been obstructive on various initiatives aimed at strengthening the EUs architecture and achieving stronger economic and political integration. It opted out of schemes developed to alleviate the impact of the financial and economic crisis on Greece and other economies. Would the ambitious 800bn (665bn) pandemic recovery plan have even been possible with the UK government still around the table? Some in Brussels would say it would have been inconceivable.

The economic effects of the pandemic inevitably blur into those of Brexit, and therefore only once the dust settles can the damage be properly assessed. Of the many problems the EU is currently facing, Brexit has happily receded from the foreground.

Excerpt from:

The EU is facing many difficulties, but Brexit isnt one of them - The Guardian

Brexit Freedoms Bill will allow Britain to change or scrap outdated EU regulations to cut red tape for its businesses.

The UK government will introduce new legislation allowing it to change or scrap retained European Union laws, Prime Minister Boris Johnson has said to mark two years since Brexit.

The new Brexit Freedoms Bill, which was announced on Monday, will make it easier to amend or remove what he called outdated EU laws that London has kept on its statute books as a bridging measure after leaving the bloc.

It will be part of what the UK leader dubbed a major cross-government drive to reform, repeal and replace the European laws retained and cut red tape for businesses.

The plans we have set out today will further unleash the benefits of Brexit and ensure that businesses can spend more of their money investing, innovating and creating jobs, Johnson said in a statement.

Our new Brexit Freedoms Bill will end the special status of EU law in our legal framework and ensure that we can more easily amend or remove outdated EU law in future.

The move is part of a flurry of announcements expected imminently from the government in key policy areas, as it also grapples with the growing international crisis over Russias military build-up near Ukraine.

However, critics have accused Johnson of rushing out half-baked plans and so-called red meat policies to shore up support among his own increasingly disgruntled Conservative MPs.

That follows persistent calls for him to resign over claims of lockdown-breaching parties in Downing Street and several other recent scandals.

Britain left the EU on January 31, 2020, but continued to abide by most of its rules and regulations until the start of 2021 under the terms of its withdrawal deal.

Although it then left the 27-member blocs single market and customs union, it kept many European laws on the books, pledging to change or repeal them individually post-Brexit.

Meanwhile, the government insists it has made huge strides outside the EU, striking some trade deals with countries and forging a new independent foreign policy built around a global Britain mantra.

But it has also been beset by issues blamed on Brexit, with the increased paperwork needed causing delays and even shortages of products while some industries complain of growing labour shortages.

Meanwhile, special arrangements agreed for Northern Ireland, aiming to avoid a hard border on the island of Ireland, have proved highly contentious there and led to increased political instability.

See the original post here:

UK to introduce new bill to scrap EU laws two years since Brexit - Al Jazeera English

Demands by French customs officials over the type of signature they will accept on post-Brexit paperwork have been blamed by UK business leaders for causing long queues of lorries on approach roads to Dover.

Two years after Boris Johnson smiled for the cameras, fountain pen in hand hovering over the EU withdrawal agreement, the British Chambers of Commerce (BCC) said a minor disagreement over signatures on customs paperwork had arisen between Britain and France.

William Bain, the head of trade policy at the BCC, said the trade body had heard from UK exporters that French customs officials were requesting a wet signature on border documents for shipments of animals and plant products from the UK.

However, he said much of the documentation is produced digitally, creating unexpected holdups on deliveries from Dover to Calais.

One of the issues at Dover currently appears to be linked to the export of food products across the Channel, Bain said. Like many of the problems this looks to be down to a differing interpretation of how the trade arrangements work after leaving the EU.

It is the latest in a string of issues with the trade deal that speaks to the wider problems of interpretation, inconsistent application and glaring gaps in its coverage.

Documents with a wet signature from an official veterinarian have been required by the EU for imports of food and animal feed from the UK since the end of the Brexit transition on 31 December 2020. While electronic certification would have been possible using an EU computer system, the UK turned down an offer from Brussels to use the platform and built its own system instead.

A UK government spokesperson said that a shortage of vessels due to ship-refitting was the primary cause of delays at Dover rather than new customs processes, although they also urged the EU to take a pragmatic approach as the new rules come into effect.

Weve always been clear that being outside the single market and the customs union would mean changes and that businesses would need to adapt to new processes, the spokesperson said.

The dispute over wet signatures is reminiscent of delays in the 1980s when France ordered that all foreign-made video recorders entering the country be cleared by a nine-person customs depot in Poitiers, hundreds of miles from northern ports where goods shipped from Japan docked.

In the two years since Brexit, UK exports to the EU have fallen sharply. Although economists say there are difficulties disentangling the impact from the fallout of Covid-19, which has caused severe disruption to global trade, Britain appears to have been hit harder than comparable advanced economies.

According to the consultancy Pantheon Macroeconomics, UK exports in November were 12.9% below their 2018 average level. By contrast, data for October from the Bureau for Economic Policy Analysis in the Netherlands showed real goods exports from advanced economies were 1% above their 2018 average.

The BCC said that on the second anniversary of Brexit, and with huge lorry queues reported at Dover last week, urgent action to improve trade with Europe was required.

It said three-fifths of UK exporters (60%) it surveyed in November reported difficulties in trading with the EU, up from 49% in January 2021. The UK government introduced full customs controls on EU imports from 1 January 2022, ending a grace period designed to smooth the transition from Brexit.

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Gareth Thomas, the shadow minister for international trade, said ministers needed to prioritise reducing red tape and delays. If ministers wont act on the chambers ideas they need to explain quickly what they are going to do to keep trade flowing.

Bain said it was possible for the UK and the EU to take pragmatic steps towards reaching new understandings on the consistent interpretation of the post-Brexit trade and cooperation agreement.

No one is expecting goods to flow as freely across the Channel now as they did prior to Brexit. But the way the trade agreement is being interpreted in 27 different EU countries is a major headache for UK business especially smaller firms without the cash reserves to set up new EU based arrangements.

Continued here:

Dover holdups blamed on signature demands of French customs - The Guardian

Brexit is a "disaster" that is leading to less overseas work and a loss of talented workers, according to leading UK architects.

Andrew Waugh of Waugh Thistleton Architects spoke of the "sense of isolation" his studio has felt since the UK left the European Union, while Sarah Wigglesworth of Sarah Wigglesworth Architects said her business is struggling to recruit and tender contracts.

A senior partner at Rogers Stirk Harbour + Partners said it is causing "friction and asymmetry", while a Glasgow-based studio claimed pressure on the architecture industry means smaller practices are "struggling to compete with lowball fee offers from direct competitors".

One year onfrom the end of the transition period when the EU's rules ceased to apply in Britain, Dezeen spoke to six UK architects about how Brexit has impacted their work.

While some pointed to the widely reported surges in building material and labour costs, they also acknowledged that it is difficult to separate the role Brexit has played from the ongoing coronavirus pandemic.

Others said the challenge is encouraging innovative and collaborative approaches to designing buildings.

"We would opt to return to how things were before in a heartbeat"Stephen Barrett, partner and head of Paris office, Rogers Stirk Harbour + Partners

"In short, it's still too soon to have a complete and accurate picture.

"Two words do immediately spring to mind, however: friction and asymmetry. Firstly, contrary to the promises being made by those advocating the United Kingdom's departure from the EU, processes that were fluid and straightforward are now more complicated and expensive, requiring significant additional time, energy and administration.

"Secondly, and it's an obvious point, the impacts of Brexit on the UK are much deeper than the corresponding impacts on the UK's EU neighbours. Whilst we eagerly await evidence to the contrary, to date nothing suggests that Brexit isn't anything other than one of history's great own goals.

"Brexit has prompted us to invest in our Paris office, to formalize and expand our presence in Europe. Brexit undermines longstanding arrangements in relation to mutual professional recognition, significantly affecting the ability of UK-based practices to qualify and compete for work across the EU.

"Furthermore, without an EU presence, obtaining the required professional insurance, and notably decennial cover is also more difficult, if not impossible.

"Were we to have a choice, as a practice I suspect we would opt to return to how things were before in a heartbeat."

"The real issue for us is that sense of isolation"Andrew Waugh, director, Waugh Thistleton Architects

"We still have our European flag flying at Waugh Thistleton Architects literally hung on the wall. It's the first thing you see when you enter the studio.

"Pre-Brexit about a third of the office were from the EU. Now we have only two real Europeans left with us in the UK. We do have satellite offices in Venice and Madrid, so that's a small positive. But we still miss them all the diversity, panache and breadth of knowledge that they brought.

"The real issue for us is that sense of isolation that we are supposed to embrace. So while really progressive legislation and research is happening in Europe and an actual effort being made into lowering carbon and promoting timber construction, here it's not really happening.

"And then of course there's the labour shortages, material shortages, inflation, all for what? Singapore-on-Thames? And so one man could obtain power? Party on Johnson!

"Our cunning plan is to move the office back to Europe."

"Brexit is turning into the disaster that many who voted Remain predicted"Sarah Wigglesworth, founder, Sarah Wigglesworth Architects

"Brexit is turning into the disaster many who voted Remain predicted. Shortages of staff, higher prices, loss of exports, loss of students in our universities and so forth.

"As a business we are finding it hard to recruit, construction price hikes are making tender difficult and we are finding materials shortages.

"Cancelling large infrastructure projects will not help the building economy. With high inflation, the nation will be poorer but will it make us more humble?"

"It's difficult to isolate the impact of Brexit"Nick Fairham, chief executive,BDP

"At BDP, we have always embraced the inclusive studio environment that the barrier-free EU environment allowed. Some of our projects stalled due to Brexit jitters but with the pandemic affecting the entire sector, it's difficult to isolate the impact of Brexit alone.

"We have adapted our design approach to meet the challenges. The widely reported shortage of materials and labour in the construction market have undoubtedly increased prices and as such, we have invested in digital technology and continue to design to accommodate for off-site manufacture.

"Ultimately, it all points to a more careful post-Brexit approach to design, where off-site manufacture, local sourcing and employment are pre-eminent and the exciting possibilities of re-using rather than throwing away are explored.

"Necessity is the mother of invention -- we hope that through the need to adopt new ways of working, using digital design and manufacture to carefully mitigate environmental impact and promote efficiency and wellbeing, we are entering the era of careful, not careless, design."

"Despite Brexit, our studio has remained delightfully mixed"Naila Yousuf, partner, Wright & Wright Architects

"Industry-wide materials shortages have been a recurring theme this year, as have extraordinary inflationary costs, though whether those are a product of Covid-19 uncertainty or Brexit is up for debate.

"Material shortages could have hindered the delivery of our projects, particularly the procurement of innovative materials like cross-laminated timber, certified Passivhaus glazing, or specialist mechanical and electrical kit.

"However, the challenge experienced by many did not negatively impact our attitude to design, or the progress of projects on-site, which is a testament to the client, design team and contractors with who we have been working.

"Despite Brexit, our studio has remained delightfully mixed [with] 30 per cent from the EU and further afield, and our studio culture is all the richer for it."

"We have seen the already challenging project budgets we're working to slashed"Marc Cairns, managing director, New Practice

"A key area of focus for New Practice is community-led development delivered in partnership with the public sector, local organisations and community groups.

"As the impacts of our exit from the European Union take hold we have seen the already challenging project budgets we're working to slashed and, unfortunately, in some cases projects have been scrapped completely due to increasing material costs and supply-chain risk.

"Critically, this is resulting in often the most disadvantaged communities missing out on meaningful schemes.

"Similar situations across the industry have also created greater competition between peers vying for these opportunities, with micro-practices struggling to compete with lowball fee offers from direct competitors and much more established practises willing to take a hit on 'loss leader' projects.

"However, there is a glimmer of a silver lining in all this. We've also seen an increase in collaboration between firms of all scales looking to innovate and offer something different in this challenging transition and we hope that this is a trend that continues to build across the industry in years to come."

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Brexit is "one of history's great own goals" say architects - Dezeen