UK lost market share in US, Germany and China due to Covid and Brexit: Report
The United Kingdom lost market share in the United States, Germany and China due to the coronavirus pandemic coupled with Brexit uncertainty, a report shows.
The country endured one of the largest export slumps of any big economy last year mainly because of a long-term stagnation in productivity growth, according to the report by Aston University’s Lloyd’s Banking Group Centre for Business Prosperity.
Exports had a fall of 14.7 percent in 2020, equivalent to £54 billion, as shipments of cars, oil and pharmaceutical products produced in the UK decreased dramatically, the new analysis shows.
“In some key export destinations – Germany, the UK and China - the UK seems to have suffered a sharper decline, experienced a slower recovery, and seen its global competitiveness dwindle,” the report said.
“The UK’s decline in exports to the US appeared the sharpest in both absolute and relative terms and the most prolonged among the major European countries (except for France).”
From 2017 to 2019, the UK raised total exports to Germany by 8.5% - less than the export increase achieved by Italy (12%), the Netherlands (14%) and Spain (20%), as well as the United States (24%).
“This to some extent paints a picture of slowing UK exports to Germany following the 2016 Brexit referendum, which may indicate some decoupling between the two economies,” said economists Jun Du and Oleksandr Shepotylo in the report.
The study, which is based on United Nations trade statistics, also shows that the UK lost market share in China as well.
“The combination of COVID, Brexit and the UK’s long-term productivity challenges will put British businesses in an adverse position for the foreseeable future,” the report noted.
The United Kingdom’s relatively poor productivity has baffled economies for years and possible explantaions for this might range from poor employee skills, to low research investment and to demand-side factors like the financial crisis.
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