By David Bailey, Professor – Aston Business School
The eleventh hour signing of the Trade and Cooperation Agreement (TCA) at the end of 2020 was claimed by Prime Minister Boris Johnson to have avoided both tariff and non-tariff barriers. The TCA certainly helped avoid a potentially very disruptive outcome in the form of no trade deal, and was welcomed by UK manufacturing.
But non-tariff barriers have indeed returned, and in a big way.
This is important, as the importance of manufacturing for the UK economy belies its relatively small size (10% of the UK economy). Manufacturing accounts for a disproportionate share of total UK exports (45%) and for 65% of private sector R&D spending in the UK. Also, some services exist because they are closely tied to manufacturing.
After decades of EU membership, UK manufacturing had become closely entwined with the EU. Nearly half of all UK goods imports and exports come from or go to the EU. Many UK manufactures had been high...