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Departure from the EU: Effect on UK Global Exports

Volume 712: debated on Thursday 21 April 2022

5. What recent assessment the Government has made of the effect of the UK's departure from the EU on UK global exports. (906454)

For the first time in decades, the UK has an independent trade policy. We have secured FTAs with 70 countries plus the EU, covering nearly £800 billion-worth of bilateral trade in 2020, creating new opportunities for our UK exporters. To take these and more—building on an over £56 billion increase in nominal exports between 2016 and 2021—our export strategy is focusing on the needs of exporters, including a new export support service for exporters to Europe.

I can never be nasty to this Secretary of State as we are old friends. The fact is though that, as I trained at the London School of Economics as an economist and I like looking at the data, I can see that we have lost £20 billion in exports since we left the European Union. The Office for Budget Responsibility and everyone else says what great damage has been done to small and medium-sized manufacturing enterprises, which Mr Speaker has in his constituency and I have in Huddersfield, the heart of SME manufacturing. Those businesses are hurting. The Secretary of State’s website says for them to get in touch with her if they need help. What help can she now give to small businesses in this country to enable them to cope?

Although there was indeed a drop in exports during covid, we have seen a 10% increase in the last quarter, which is very welcome. I am always happy to meet the hon. Gentleman, as he knows, to discuss any particular businesses, but the export support service, which has now been running for a number of months, is there to support SMEs in particular if they have issues with a country in Europe with which they want to trade. The team has also been focusing on supporting businesses with Russian and Belarusian activities in the past month, especially on supporting them to find alternative supply chains. The export strategy, which we published in October last year, is bringing together a whole series of tools to help those SMEs to discover new markets, and, indeed, to use the ones that now have more prospects thanks to the FTAs that we have.

I congratulate the Secretary of State and her Department on their success in lifting the US 232 tariffs on UK steel and aluminium. Does she not agree that this flexibility to boost global trade afforded to us by our departure from the European Union is exactly why my constituents voted for Brexit?

I congratulate my hon. Friend on his recent marriage, which is very exciting. Let me just note that those of us on the Front Bench begin to feel very old when our youngest Members start taking this great step of confidence, which exactly reflects how my hon. Friend has campaigned for his constituents on the matter of steel. It has been a real pleasure to be able to bring the section 232 tariffs to a conclusion so incredibly quickly, working with my US counterparts and understanding that our UK-US relationship is critical not only to trade, but across so many of those inter-related activities. We are working closely together on trade and security matters as we deal with the terrible challenges in Ukraine.

It is good to see the Secretary of State in good health.

With what the Secretary of State calls the UK’s independent trade strategy, the UK cannot even export a chicken leg to any country in the world without the commensurate weight of paper and bureaucracy going with that chicken leg. When she sees the lorry queues in Kent and what used to be an easy market for the UK, I wonder whether her Department has catalogued the hurdles of paper that exporters now have to cope with to trade with the European Union, especially as the Financial Times reports that, in “cut-off” UK—to quote the Minister—exports have fallen 14% compared with a rise in the rest of the world of 8.2%. This independent trade strategy is looking pretty woeful.

As I have already set out, the export support service, which we launched at the end of last year, is there to support those SMEs that have experienced technical issues when trading with the EU. Many of those issues have now been resolved, and we are helping businesses to deal with them. We are also helping those SMEs in all our constituencies that are considering exporting for the first time to look at how they can discover markets within the EU, across the wider European nations and in the rest of the world.

I take this opportunity to wish Her Majesty the Queen a very happy birthday, and all the great people of England a very happy St George’s day at the weekend.

With the Chancellor’s having accepted a report from the Office for Budget Responsibility confirming an ongoing 15% hit to British exports to Europe, and given, as my hon. Friend the Member for Huddersfield (Mr Sheerman) alluded to, the continuing extra red tape, customs checks and costs that businesses here face thanks to the Prime Minister’s poor trade deal with Europe, when will the Secretary of State publish a plan to put right some of that damage, to help British business and to make Brexit work better?

I will set out just some of the areas the export strategy is bringing forward, to help the hon. Gentleman to see exactly the strategic work we are doing. There is the export support service, which I have mentioned, and financial support for exporters, working through the shared prosperity fund to include export support through local investment plans. UK Export Finance is there to help and will look at supporting SMEs, where historically it has only supported large contracts. Having run a successful regional pilot of the UK Export Academy, we are rolling that out across the UK, providing digital tools. That is proving very popular, as businesses can educate themselves before launching into new markets.

The Department’s own research shows that export-related jobs pay higher than average, so the hit to our European exports, which the Secretary of State seems so complacent about, will prolong the cost of living crisis. It also underlines that since 2010 British exports have significantly underperformed compared with the rest of the G7, notably the United States and Germany. Businesses tell us that other countries have more ambitious export support programmes, while the Prime Minister blames our exporters for a lack of “energy and ambition”. Where does the Secretary of State think the blame lies?

I have set out the export strategy, which is bringing forward these tools, which goes exactly to the hon. Gentleman’s point. We are the opposite of complacent; we are here to support, through a dozen different routes, businesses to grow the export markets they already have or to discover exporting for the first time. One in seven businesses that could export does not yet, and we are keen to help those businesses find those markets across the globe, not only across the EU. Free trade deals such as the comprehensive and progressive agreement for trans-Pacific partnership, which we are negotiating this year, will give us the opportunity to open up nearly $8 trillion-worth of new markets. We want to ensure that businesses can access those through all the tools we are providing for them.