Ten Years On from Referendum

研报英文原文证据摘录

Ten Years On from Referendum

ings, and inorganic non-metallic

products, which all fall broadly under the "semi-manufactures" category. This sub-sector is,

indeed, the main driver of the drop in UK goods exports to the EU. However, the weakness

in UK manufacturing exports has been fairly broad-based, which suggests that energy

costs are unlikely to be the sole culprit.

A constant feature of post-Brexit UK has been the blockbuster exports performance of its

services sector. In real terms, this is 30% up vs. 2018. As we wrote in 2023, this pick-up

has been geographically broad-based, which implies that the outperformance was not just

to do with intra-subsidiaries trade between the UK and the EU. Business services and

travel have been particularly strong drivers of services exports growth, with the US

accounting for a higher market share among UK services sector corporates. However, it is

important to note that it is challenging to separate any post-Brexit structural shifts from

the cyclical pull of the robust US economy – a global DM outperformer – in recent years.

Indeed, our bias is to assume the outperformance of the UK's services sector is largely a

cyclical story.

Summing all this up, we note that the hit to UK trade materialised post-Brexit, albeit

with some caveats. The UK underperformed its G7 peers in trade volumes – where trade

openness as a metric combines both imports and exports – after the TCA came into force

in 2021. However, by 2025 trade openness had rebounded back towards the G7 average,

supported by strong services exports. Given the potentially cyclical nature of the services

exports outperformance, one can look at UK trade openness in the counter-factual space.

Had the UK's goods trade openness fared in line with G7 peers, the strength of its services