New research by business group Logistics UK has raised the prospect of increased food prices and the potential for shortages in shops as a result of delays caused by the implementation of the new European Entry and Exit System (EES).
Working with independent modelling experts MDS Transmodal, Logistics UK's exclusive insight examines the potential impact of delays on trade across the Channel Short Straits – the route between Dover and Calais – on the UK economy. And as Kevin Green, the business group's policy director, explains, the introduction of the new EES could have a significant impact on the UK's supply chain unless any potential delays can be mitigated or, at the very least, minimised:
"The Short Straits is critical to the UK's trade with the EU, handling more than half of all goods carried in trailers and containers. Goods travelling across this route range from exports of Scottish seafood, fresh meat and clothing to imports of fresh fruit and vegetables and even cocoa – it is a critical part of the UK's supply chain, and one that both businesses and consumers rely on every day.
"With new border checks required as part of the new EES for all non-EU nationals entering the EU, including those travelling from GB, worst case scenarios set out to the European Scrutiny Committee in Westminster by Ashford Borough Council estimated delays of up to 14 hours for passengers. Any delay in the processing of passengers will have a knock-on impact in terms of disruption and delay to freight along this route, and it is estimated that this would cost £1,100 per truck, a cost which would have to be passed on to the end customer or consumer. And even if delays were limited to 90 minutes for the 3.35 million HGVs that passed through the Short Straits in 2023, the cost to the economy would be £400 million pa. This is a cost that the logistics industry cannot just absorb, not least because members already operate on incredibly narrow margins and are facing rising operating costs that are putting pressure on their ability to keep trading."
"There are two sides to any border, so delays to exports will also impact inbound goods. With the new system being implemented from October, at a time when the UK relies on imported fresh produce in particular, this could cause supply shortages and rising prices for British consumers – if the produce arrives at all. EU hauliers may well decide to bypass the potential for delays at the UK border altogether, opting to work with retailers on the European mainland instead, further reducing supply and pushing up prices for UK consumers."
Increasing the potential for border delays still further, the new EES is being implemented by the EU in parallel with regulatory changes on border control by the UK on EU imports. Following the introduction of documentary and risk-based identity and physical checks on goods in April 2024, Safety and Security Declarations will be required for imports into Great Britain from the EU from October 2024: these checks, alongside the EES biometric passport checks which will be needed for non-EU travellers, will multiply the risk of delays and congestion along entry routes to the Channel ports, and put further pressure on the UK's supply of fresh food and other commodities. Green continues:
"Adding border checks on imports to the delays caused by EES could have a disastrous impact on the UK's supply chain, which was previously about supplying goods as and when they are needed – or "just in time". In recent years, the impact of delays at the Short Straits due to border closures, customs strikes, and adverse weather conditions has been observed. Delays could become a regular occurrence and have even more of an impact on the UK's supply chain if an app-based solution is not implemented swiftly to take some pressure away from the border along this critical GB EU supply chain route. Estimates show that about 46,000 companies regularly trade in goods where at least 25% of the commodities they deal with pass through the Short Straits, and these businesses are spread throughout GB. The impact of delays at the border will be felt nationwide and could have a significant impact on the UK's ability to do business with its closest trading partner in the longer term.
"The UK's logistics businesses pride themselves on delivering for their customers and the economy, but EES could bring unworkable delays and additional costs to the country's supply chain, which is still feeling the impact of the COVID-19 pandemic. The call is for the government to intensify its diplomatic efforts with French counterparts and the European Commission, while collaborating closely with the logistics industry and essential local partners. This is to mitigate the impact of the EES and streamline border processes, aiming to prevent significant damage to the UK's trading relationships with Europe."
For more information:
Logistics UK
Tel: 03717112222
Email: [email protected]
www.logistics.org.uk