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New food checks could impact UK businesses. Editorial credit: Alan Morris, via Shutterstock
Almost eight years since the Brexit vote, the political and economic ramifications of the referendum continue to make themselves felt. Even though the UK has formally left the European Union, regulations are impacting businesses in new and sometimes unexpected ways.
Enter the French government. According to a recent study, new border controls advocated by Paris are set to increase the cost of agricultural imports from the continent by €2.3bn (£2bn) every year. That’s a massive sum and one that could impact your margins and cashflows, as well as the wider economy.
So, what are the new regulations and how will they affect British companies? We take a look in this week’s Smart Currency Business blog.
Rouge tape
The EU (in particular, France) and the UK have been butting heads for some time over Brexit regulations. This typically plays out in politically potent fields, such as immigration, customs and fishing. The fact that it has now spilled over into agriculture presents a political problem for the UK as well as an economic one.
The EU is set to impose new customs checks from 30th April, having previously postponed them on five separate occasions. A recent study from a French research thinktank found that these regulations alone could contribute 0.2% to UK inflation over one year. A small figure in isolation, but a significant one when you consider that the Bank of England is trying desperately to pull inflation back down to 2%.
Agriculture and its various byproducts are one of the most visible trading links between the UK and the continent. Among the products affected by the new rules at the Channel crossing are certain cheeses, butters or creams, sausages, ham or cold meats, as well as cut flowers.
The ghost at the feast
Brexit has been a political hot potato ever since the vote. For a while, its impact was obscured by the Covid-19 pandemic and the subsequent recovery. However, as more and more details are worked out by the respective governments, an increasing number of businesses are feeling the effects.
Almost all importers and exporters will have been impacted (whether positively or negatively) by Brexit. Another issue with new rules such as these is the effect they have on other industries, which have been plagued by worries that they will be the next to have to conform to regulatory requirements.
The legal question of Brexit still rumbles on. For many, the benefits of the referendum have been obscured by the question of how and when they could be affected by changes to the rules.
How Smart Currency Business can help
Smart Currency Business arms your company with the tools to mitigate risks to your budget. Both importers and exporters have spent a tricky few years figuring out just how much they’ll be affected by Brexit. Our experienced team of experts can help you plan for volatility, giving you peace of mind over your cashflows and helping to protect your margins and budget.
To learn more about how Smart Currency Business can help you, give one of our friendly account managers a call on 020 3773 7402 or visit our website for more information.
