Anxiety Over Brexit Collapses the Cross-Border Delivery System
British companies are rushing to store goods with only five weeks to go before post-Brexit customs controls take effect on January 1. It is causing a rise in the cost of cross-border deliveries and reducing capacity, according to industry sources.
The frantic activity reflects rising concerns that Britain’s final departure from the world’s biggest trading bloc will bring chaos at its frontiers. Companies struggle to navigate a full customs border for the first time since 1993.
According to several logistics companies, they had seen increased demand to bring goods into the UK ahead of any hypothetical disruption in January. Customs agents report that they are overwhelmed by requests for help from traders, who are faced with new regulations.
Jon Swallow, director of Jordon Freight, referred to the dynamics of the last two weeks. He stated that they had told their customers the best they could do at the time was to stock up, store, and they were bringing everything they could.
The consequence of this is that there is not enough capacity, and prices are skyrocketing. Swallow explains that increased demand has pushed prices up by around 20% in recent weeks. They are likely to rebound further in December.
Transport prices skyrocket
Tony Shally, from Espace Europe, points out that the cost of travel between Poland and England and between France and England has increased by more than 10%.
This frenetic activity reflects the need to prepare for the UK’s exit, from the world’s largest trading bloc. Brexit means that goods entering the European Union after December 31 will need customs and security declarations, as well as border controls.
Businesses had already started stockpiling goods in the run-up to Brexit. But now, following the impact of the pandemic, many of them are in a weaker financial position.
In addition to the urgency of introducing goods before January 1, many companies have to prepare to process customs declarations for the first time. It is putting enormous pressure on the small customs sector.
Sam Harris, operations manager for Freight UK, explains that just answering phone calls from new customers has become a full-time job. Most do not know anything about customs; he sums up. Everybody is panicking.
According to Britain’s logistics industry estimations, 250 million customs declarations a year will be needed for EU trade.
The Road Haulage Association predicts that it will require some 50,000 customs agents. The number of agents now equal between 5,000 and 10,000.
The government has provided £84 million to train staff. However, many companies in the small sector have refused to take on workers before finding out how the new system will work. Therefore, those companies providing customs are in huge demand.
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