Brexit and its influence on trading?

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Brexit and its influence on trading?

18 december 2017

As you know, the UK wants to split from the EU. We all want to know what will happen in trading with the UK once they’ve split from the EU. First we’d like to show you some numbers from the Chemical Industries Association (CIA) report on production and trading with chemicals in the UK.

The chemical and pharmaceutical industry adds £14.4 billion of value to the UK economy every year from total annual turnover of over £40 billion. This represents around 10% of the value added by the whole of UK manufacturing. 

In addition to gross value added, the sector also contributes to the UK economy in its position at the head of many supply chains within manufacturing and its employment of a well remunerated, high-skilled workforce. Chemical manufacturing adds £9 billion in gross value added annually and pharmaceutical manufacturing £5 billion.

The wider chemical and pharmaceutical sector (manufacturing plus distribution) is the largest exporter of manufactured goods with annual exports of close to £50 billion. The export of motor vehicle, trailers and semi-trailers is the sector with next highest exports of £35 billion.

63% of companies in the sector export what they make to the world, the highest proportion of any goods manufacturing sector in the UK economy. 60% of our exports go to the European Union and 75% of our imports and raw materials come from the European Union.”

Source: Chemicals Industries Association, 16 Nov 2017 https://tinyurl.com/brexit-trading

With that, the CIA stresses that it is very important to make certain agreements about trading tariffs and tariff-free zones. CIA and Cefic spell out that a Brexit without a new trade agreement would be the worst possible outcome for both the EU as the UK. As 60% of the good produced goes to the EU, it is important for the Brexit to have an agreement about the tariffs, to ensure that the trading will continue on this level. We are curious about the consequences of the Brexit and will let you know more when we find more information on this topic.