Andalusian exports to the United Kingdom (UK) have increased in the first seven months of the year by 16.1% year-on-year to reach 1,413.9 million euros, according to the Brexit Monitoring Report on the Andalusian economy presented by the Department of Economic Transformation, Industry, Knowledge and Universities of the Government of Andalusia.
According to this analysis, sales to the British market will recover positive growth rates between January and July 2021, once the transitional period has ended and Andalusia has acquired the status of a country outside the EU. Moreover, this takes place in a context of a recovery in world trade after the historic contraction of 2020. However, this progress is of lesser intensity than that shown by the region’s trade relations with foreign countries, which totalled a volume of 19,701.9 million and an increase of 18.2%.
In 2020, in a context of a sharp fall in world trade due to the COVID-19 pandemic, Andalusian exports to the UK were relatively less affected, with a fall of 2.4% and totalling 1,967.8 million. This is significantly less than the drop in total sales, which amounted to 27,831.9 million after falling by 12.3%. Between January and July, therefore, the levels reached in the same period before the pandemic (2019) have been recovered, although they are below those of the same months in 2016, the year of the Brexit referendum.
According to the type of products traded, the most significant sales, accounting for more than half of total exports, have been recorded in the food, beverages, and tobacco sector (732.5 million), although they have suffered a 4.3% year-on-year fall. In this section, the reduction in oils and fats (-56.4%) and the increases in strawberries (17.6%) and peppers (18.1%) stand out. In second place in the ranking are semi-manufactures (233.3 million), with a rise of 36.4%, especially cement, concrete, and artificial stone (113.6%). In third place are sales of tanks and other armoured vehicles, which amounted to 180.7 million euros in the period, 12.8% of overall sales.
The productive investment in Andalusia made by the UK in the first half of the year amounted to 22.2 million euros, 14% higher than that recorded in the same period of the previous year, the highest in the first half since 2017. In 2020, UK capital landings increased by 3.6% year-on-year, equivalent to €38.3m, significantly below that of overall foreign investment, which scored a 23.3% raise and a volume of €1,052.8m.
In 2021, however, the recovery is stronger in the UK than in the EU. The progress of vaccination, the progressive lifting of mobility restrictions, and the development of activities more linked to social consumption have led to positive growth rates in the second quarter of 2021, for the first time since before the health crisis. Gross Domestic Product (GDP) has increased by 22.2% year-on-year in the UK, above the EU average (13.8%), taking into account that in the second quarter of 2020 the fall was also much higher (-21.4% in the UK compared to -13.7% in the EU).
The balance for the first half of the year was real GDP growth in the UK of 6.5% year-on-year, seven-tenths of a percentage point higher than in the EU27 (5.8%). This performance is reflected in the UK’s demand from the rest of the world, especially for goods, but not for services, which continues to show a downward trend in British tourism.
