The Logistics Industry – what will an exit from the EU mean?

Trading places: How a British exit from the EU could affect the logistics industry

The potential for Britain to exit the EU is higher now than ever before. Indeed, one of the largest talking points effects on logistics for an eu exitsurrounding this year’s General Election was that of Britain’s membership of the European Union, with fierce political battles taking place as to the best way forward. With this, an in/out referendum will take place in either 2016 or 2017: the British public will make a simple yes or no decision whether to stay in the EU or to leave it altogether.

The impact of the result will have enormous consequences on the logistics industry: with membership of the EU comes free movement within the Union as well as special trade arrangements. In this article we take stock of some of the bigger issues that British logistics services face as a potential ‘Brexit’ draws ever closer.

A partnership redefined

The EU is currently Britain’s largest trading partner, with 52% of the nation’s goods and services exported to the EU. As such, the European market is the most important to the UK economy and to British business, and recent events that have caused long delays at the cross-channel ports in Calais have proved the sheer scale of import and export traffic which crosses the Channel.

A British exit would mean that trade deals in place with EU nations will have to be renegotiated and higher exportation tariffs introduced, which could see less trade altogether for British-based exports to the continent. The bottom line here is that with a shrinking level of exportation to Europe comes a shrinking demand for professional logistics and fulfilment services. A domino effect would be seen as exportation first decreases, ending with logistics services taking the final tumble.

Movement within the EU

An often overlooked aspect of the debate surrounding a potential British exit from the EU is that of movement within the mainland itself. As a current member of the Union, British citizens enjoy the ease of free movement between member states with limited disruption; fast-tracking through the EU lines at passport control allows for relatively hassle-free travel across the continent.

However, this freedom will most likely be lost in the event of an exit. As a result, each European border could provide a slow, meticulous process of passport control and goods assessment for logistics traffic. This will no doubt add hours onto delivery times and extra administration work for navigating these once open borders. Costs will go up, delivery speed will go down, and customers will become agitated.

Britain’s membership of the EU is a complex topic to tackle. Whilst the issue has divided the nation, it is clear that there are risks involved in the event of an exit for logistics, an industry based on fulfilment of client goods. The dangers involved in a ‘Brexit’ could mean that trade between British and EU companies decreases, which would lead to decreases in the demand for professional logistics services to the continent. Whilst time will tell if Britain leaves the EU, the dangers of doing so for the logistics industry are clear.

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