Brexit caused food price hike in the UK, report says

LONDON — New trade barriers as a result of Brexit have caused a 6 percent increase in food prices in the U.K., according to researchers.

A new report from the U.K. in a Changing Europe think tank said the hike was not down to the coronavirus pandemic. The findings pile pressure on U.K. Prime Minister Boris Johnson, who led the pro-Brexit campaign and is now grappling with a cost of living crisis.

The so-called trade and cooperation agreement (TCA) struck between Britain and the EU has led to checks on goods going from the U.K. to the bloc from the start of 2021 — as well as increased paperwork for traders.

According to the report, the increase in trade barriers led to a 6 percent increase in food prices between the end of 2019 and September 2021, in comparison with the years before December 2019.

Products which make up a larger share of EU imports, such as fresh pork, tomatoes and jams, were more affected than those making up a smaller share of EU imports, such as tuna and exotic fruits like pineapple, the researchers added.

“Covid-19 is ruled out as a factor to price changes, as key events in the pandemic are not obviously correlated with the changes and, furthermore, we are able to control for economy-wide macro-impacts such as national lockdowns,” the report said.

It follows research from the London School of Economics (LSE) published this week that found Brexit resulted in “major disruption” to U.K. trade with the EU. It said the new relationship led to a “sudden and persistent” 25 percent fall in U.K. imports from the EU relative to the rest of the world.

The decline in U.K. exports to the EU was smaller and short-lived, the LSE researchers said. “Nevertheless, there was a sharp drop in the number of trade relationships between UK exporters and EU importers, which suggests that the introduction of the TCA caused many UK firms to stop exporting to the EU,” they added.

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