UK on course to drop from Germany's top 10 trading partners

The UK has been in Germany's top 10 trading partners since 1950.

But, with Brexit-related hurdles taking a toll, Britain looks set to drop to the 11th spot by the end of this year.

Germans spent £13.8bn, or nearly 11%, less on British goods in the first six months of 2021, according to data from the Federal Statistics Office.

Companies are actively swapping UK suppliers for EU ones, seeing British exports "free-fall" - and this trend is only increasing, an expert said.

Britain left the European Union's single market at the end of 2020 after four years of wrangling. Since then, customs checks have been implemented which have complicated trade.

"More and more small and medium-sized companies are ceasing to trade (in Britain) because of these hurdles," said Michael Schmidt, president of the British Chamber of Commerce in Germany. They "simply can't afford the extra burden of keeping up to date and complying with all the kicked-in customs rules such as health certificates for cheese and other fresh products".

Two sectors that have been particularly hard hit are agriculture and pharmaceuticals, where imports have dropped by 80% and half respectively.

This has seen Britain fall down the ranks of Germany's top trading partners: it is likely to hit 11th place this year from ninth last year, and fifth before it voted to leave the EU in 2016.

Despite this, the UK is still buying a lot from Germany, with imports up 2.6% to $32.1bn in the first six months of this year.

Mr Schmidt says the new trade realities would have hit small British companies more than German ones, as they were less accustomed to selling their goods outside the European Union: "For many small British firms, Brexit meant losing access to their most important export market... It's like shooting yourself in the foot. And this explains why German imports from Britain are in free-fall now."

Gabriel Felbermayr, president of the Kiel-based Institute for the World Economy said these impacts aren't going anywhere: "The UK's loss of importance in foreign trade is the logical consequence of Brexit. These are probably lasting effects."

The Department for International Trade did not immediately respond to the BBC's request for comment.