“UK Trade with the EU Is Higher Than pre-Brexit Levels”

Despite cross-channel hold-ups, lorry driver shortages and labour shortages as many EU nationals have gone home, UK trade with the EU has improved over the last five years. However, EU trade is increasing as a proportion of total trade and the trade deficit with the EU has grown twice as fast as with the rest of the world. According to ONS:

 “Total exports of goods increased by £2.3 billion (7.4%) in May 2022, Goods exports to the EU reached £16.9 billion in May 2022. Though this is the highest level since the series began in 1997; rising prices in 2022 mean removing the effect of inflation, exports to the EU actually rose to only £13.9 billion, the highest levels since December 2020.”

UK Office of National Statistics

ONS statistics for UK trade comparing the last two quarters are shown in the Table below.

This shows the 16.1% growth in exports to the EU was overtaken by a n 18.6% growth in imports from the EU, with a 31.0% trade imbalance having swelled by 5.8%. Meanwhile, non-EU trade, where Brexit should be showing benefits, grew by barely half the increase in EU trade. Looking further back, the trade deficit with the EU has effectively doubled See the chart below.

At present, it is not clear whether the reduction over the last two years is structural or caused by current factors like Covid. However, recent figures given in Table 1 imply it is worsening again.

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