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Customs Tariffs, Fall Of The Pound Sterling And Changes In Export Procedures, Main Effects Of Brexit

Customs tariffs, fall of the pound sterling and changes in export procedures, main effects of Brexit

València, Spain (PortSEurope) November 9, 2020 – Cámara Valencia has held a webinar on the future of Valencian foreign trade after Brexit. The United Kingdom is the third market abroad, with 1,816 Valencian companies that regularly export €2,573 million in 2019. Almost a third of the tourists who visit Valencia are British and Alicante leads the provincial ranking of British residents in Spain. This data has
highlighted the importance of the British market for the economy of the Valencian Community. The United Kingdom is an open, dynamic, but also mature and highly competitive market that requires investment to operate. A Brexit without an agreement will imply customs fees, will affect the Pound / Euro exchange rate, will imply changes in the export-import procedures for Spanish companies, tax changes, etc. The analysis carried out among the 150 exported sub-items shows that Brexit will have a tariff impact close to €200 million and an average tariff rate of 8.3%, a cost that will be borne in part by end consumers with the price increase and partly also by exporters. Almost half of Valencian exports are of motor vehicles, while agri-food products account for 25% of exports to the United Kingdom in 2020. For automobiles, the tariffs that Brexit would cause without an agreement would be 10%, while in agri-food they would reach 11.8% on average, which would harm the competitiveness of our products in that market, with fresh products being the most victims. The sectors with the greatest business opportunities with a no-deal Brexit would be: construction materials (the tariff rate would be very low or null: 4% in ceramic tiles and zero percent in glass, marble or tiles), footwear sports, habitat (furniture and lighting, especially) cosmetics (with zero tariffs and growth of 41% in 2020), as well as machinery, also without tariffs. However, others such as the footwear sector, the home textile sector, may be more affected by tariffs, the downward trend in exports and greater competition from third countries. A no-deal Brexit would also impact tourism, already affected by the Covid 19 crisis, while other services such as consulting or engineering would be sectors of opportunity, as well as technology, communications, patents and trademarks and services associated with exports. The company must prepare to trade with a third country, with new technical and legislative requirements, etc; short-term problems in logistics (especially for perishable goods); changes in the immigration system and displaced workforce, etc. Copyright (C) PortSEurope. All Rights Reserved. 2020.

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