A NEW ERA

With Brexit having come into full effect on January 1, how will the UK’s ties with the GCC evolve?

- AARTI NAGRAJ

It was a nail-biting finish, almost. The saga that was Brexit stretched on to the last minute, with uncertainty about whether the European Union and the UK would strike a trade deal or see an acrimonious ‘no-deal’ split. A historic trade deal was finally signed on December 24, a week before the end of the Brexit transition period, triggering relief on both sides.

The days following January 1, 2021 have been bumpy, with expected issues on the EU-UK borders – especially for freight operators. “As already seems to be the case after the first few days, the new arrangements are not without their challenges in terms of paperwork and red tape,” says Joe Hepworth, director of OCO Global, and founder of the British Centres for Business (BCB).

“It seems that companies had preempted this (as well as a no-deal scenario) by stockpiling ahead of the year-end, so volumes have been relatively low. I would expect to see an increase in issues and frustration around all of the new processing that needs to take place as things pick up again,” he adds.

It will take time to understand how smooth the transition will be, says Stephen Watson, partner at Expense Reduction Analysts, UAE.

“After many years of being tied to an economic union, I am sure there will remain some significant challenges on exit. There are still a number of contentious areas such as rights to fishing and some significant matters not yet addressed such as the role the city of London plays in a banking and finance context. Consequently, it’s likely we are only seeing the tip of the iceberg in terms of next steps for Brexit,” he elaborates.

In a note last month, consultancy PwC also cautioned that it is important to remember that while a deal has been agreed, it is not all encompassing.