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Brexit friction costing UK economy £12 billion, says Logistics UK

Border frictions stemming from Brexit and misalignment with key trading partners have held back the UK economy by an estimated £12 billion — equivalent to around £400 per household — according to new analysis from business group Logistics UK.

The figures, compiled by independent transport economists MDS Transmodal, show that closing the gap between the UK’s current trade intensity and its 2019 level could unlock that sum in long-run economic output without requiring tax rises or additional public spending. Logistics UK is launching a campaign urging the government to pursue trade-led growth by reducing border friction, timed to coincide with meetings in Brussels between Chief Executive Ben Fletcher and senior EU policymakers.

The underlying trade data makes stark reading. In the ten years since the 2016 referendum, total UK goods trade by tonnage is down almost 10%, with exports falling 20.7% and imports declining 3.6%. By volume, UK exports to the EU have fallen 15.9% over the same period, with exports to non-EU Europe and the Mediterranean down 5.0% and exports to the rest of the world down 37.2%.

Logistics UK is pressing for several specific measures ahead of the UK-EU Summit confirmed for 22 July. These include a comprehensive sanitary and phytosanitary (SPS) agreement — which the UK government estimates could add £5.1 billion annually to the economy and which Logistics UK says could cut export costs by 5–8% on affected agri-food goods, saving £150–£250 per consignment. The group is also calling for a Single Trade Window interoperable with EU systems to eliminate duplicated data submissions, and an exemption for professional HGV drivers from the 90-days-in-180 Schengen travel restriction, which Fletcher said was increasingly constraining drivers on frequent or extended European runs.

“More than half of UK-EU goods trade moves via the Short Straits, and the EU accounts for around 40% of UK exports,” said Fletcher. “A targeted effort to reduce trade friction would have a significant and immediate economy-wide impact.”