Britain’s goods exports have “collapsed” to levels not seen for three years in response to growing Brexit uncertainty and slowdowns in the Chinese and the US economies, according to a quarterly trade monitor.
Business consultants BDO found that the UK’s goods exports, which have suffered a slowdown in growth since the beginning of 2017, contracted in the last three months of the year to leave them at a level not seen since 2015.
The pan-European report echoes the complaints of UK business leaders who have stressed that delays to a Brexit deal come at a time of increasing worries about the outlook for global trade.
Investment by UK businesses has all but dried up in the last year according to official figures and manufacturing is heading into a recession driven by a sharp fall in car production and sales.
BDO said its findings showed that exporters were being hit by Brexit, “significant” economic turmoil across Europe and the threat of protectionist tariffs that also affected firms on the continent.
UK economy slows as car sales slide
Businesses in France, Germany and Italy were hit by falling business confidence and slowing trade, although only France’s export sector has declined at a faster pace than the UK’s over the last three years.
On Friday stock markets tumbled following a slew of negative economic data showing the US and China – the world’s number one and number two economies – were slowing while a report by the European Central Bank forecast lower growth across the eurozone next year and in 2020.
Spokesman Peter Hemington said: “Across Europe, economic disorder has led to EU export growth stagnating. Three of the five largest EU economies are battling against political and economic chaos.
“The French economy is set to suffer further from the gilets jaunes (yellow vest) protests, Germany’s car manufacturers are struggling with new regulation and, in the UK, government infighting is taking its toll as we edge closer to a disorderly Brexit.
“Overseas demand has helped sustain the UK economy over the last few years and British businesses are doing all they can to remain resilient despite these challenges. The EU remains our most important trading bloc but Brexit uncertainty is proving damaging.
“It’s crucial that Britain is seen to be open for business with the EU and other key markets as we enter what is going to be a critical year for the UK.”
The BDO quarterly index for the UK fell 0.7 points to 94.9, below the point of contraction of 95.0.
German export growth fell 2.6 points to stand at 96.8 in the fourth quarter, while France – the worst performing major EU economy this quarter – saw its export growth collapse by 4.8 points to 92.8.