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As we all know, Brexit has affected everybody in the United Kingdom and is transforming businesses, both big and small. The cause of Brexit and post covid is one of the reasons for many businesses to go bust but, as the famous saying goes, when one door closes, another door opens. The Current Trading Problems…
As we all know, Brexit has affected everybody in the United Kingdom and is transforming businesses, both big and small. The cause of Brexit and post covid is one of the reasons for many businesses to go bust but, as the famous saying goes, when one door closes, another door opens.
Global trade was affected massively during covid-19. Then Brexit followed shortly after, causing trading to be difficult for those in the United Kingdom. Not to mention the Ever Given ship that blocked the Suez Canal for six days, halting trading for Europe and the rest of the world. Ever since, there have been many issues for small and large businesses, especially in the United Kingdom.
Although some of these issues have been resolved, the war in Ukraine has also affected the world, causing an energy crisis. Additionally, the United Kingdom receives millions of pounds of materials from Ukraine. Due to the war, the costs of those materials have increased because the UK has to go elsewhere.
The rising costs of materials and inflation of our energy bills mean companies are increasing prices for products and services. Now, consumers are receiving the problems the UK government and businesses have faced.
The United Kingdom has realised they are overly reliant on other countries, especially those in Europe, for materials and food products. Britain is known for its agriculture but the question is whether or not it can sustain the demand in the country.
It is safe to say that the United Kingdom is now looking at becoming more sustainable because it may be the more affordable option, especially for UK businesses. However, there has not been much change in this. Currently, the only transformation that has been made is giving EU standards UK names. For example, the EU Emissions Trading System has replaced the UK Emissions Trading System.
Environmental issues have almost been invisible since the process of Brexit began. It is surprising to many as people know that this affects the whole world, not just the United Kingdom. These issues are not just specific to one country, it is a global crisis.
Whatever the government does, it will always let down some people. However, dealing with the issues regarding global warming is something that will satisfy much living in the United Kingdom. Nonetheless, many citizens in the UK believe the government is not acting quickly enough on those issues.
The government has the problem of adapting the 1,100 EU environmental laws and regulations to UK laws. These include laws about water, air and habitats. Nonetheless, once it is finalised, the UK doesn’t necessarily have to stick to these laws.
The UK government is looking to be carbon neutral by 2050. For this, UK homes are supposed to use clean electricity(renewable sources) by 2035. Additionally, 600,000 heat pumps are expected to be installed by 2028 however, only 280,000 heat pumps are installed currently. Moreover, the installation of heat pumps has slowed down dramatically as the installation rate should be 15.3 but was only 1.48 per 1000 households in 2021.
Finally, petrol and diesel cars can no longer be sold in 2030. Again, this depends on the production of electric cars in the United Kingdom. Although they will be legal to drive after 2030, the London Mayor is looking to ban petrol/diesel-powered vehicles by 2025 in the capital.
The government has to ensure they are enforcing the UK laws however, businesses have a part to play as well. They must ensure they are doing the right things to become more sustainable. They also need to put pressure on the government to enforce these laws.
Something else businesses need to do is look for opportunities and assist the government with new laws and regulations, whilst maintaining a good product standard. For example, ensuring vehicles are energy-efficient and meet the requirements of the EU or else those vehicles will not get accepted.
Companies also need to try and keep the relationships they have built with other businesses in the EU. It is a great way to remain relevant, and climate change is a global issue, not a UK issue so we need the whole world to work together.
Northern Ireland made an agreement that once they left the EU, they would still follow certain EU Customs Union Regulations. Now, there are fewer custom checks in Northern Ireland, resulting in many UK businesses moving their operations to Northern Ireland. The reason is that they can get around the costs of those that have increased since leaving the EU.
Some of the businesses in the UK have managed to claim financial support. Due to this, it has helped many companies with exporting their products around the world. Moreover, because businesses are struggling with finances and shipping issues, the UK Export Finance is at its highest amount of credit for lending in 30 years.
The issues that small businesses are facing are on a much larger scale compared to those bigger businesses. They don’t have the financial stability of those larger companies and therefore, need to raise the costs much more. Furthermore, they don’t have the staff power or the same resources to cope with these issues. Due to this, over half of the small businesses are struggling with exporting to the EU. Trying to be sustainably conscious whilst keeping their business afloat is proving difficult in the UK.
As a result, the UK government has understood these issues and offered small and medium funds to help with the trading challenges.
Well, exporting is expensive and difficult to find a way around the issues regarding that. However, in terms of importing, there are a few things a business can do. For example, importing raw materials in the UK is not only cost-effective but also eco-conscious. It is a great way of encouraging more businesses to be more sustainable.
Businesses in the food industry don’t need to export fruit and vegetable products from overseas when we can grow them in the UK. The same goes for meat. We have miles and miles of fields all over the country and can produce our homegrown food. According to the BMPA, the UK imports 35 per cent of the beef and veel it consumes per year.
There will be a lot of demand in the UK over the next 5-10 years. Nonetheless, this will create several jobs in many different areas due to the demand. The transition phase will take a while but will be more eco-friendly once it has transitioned.
The problem the United Kingdom has is that they rely on other nations to provide energy for them. Additionally, the UK doesn’t produce most of its renewable energy. This means the UK could miss out on targets which have been set.
In comparison to other nations in Europe, the UK is far behind and not on track. According to a report from the Association of Renewable Energy and Clean Energy (REA), two-thirds of electrical consumption wasn’t met with renewable energy.
Another thing which is enforced is rolling out smart metres. At the moment, only 45% of properties in the United Kingdom have a smart metre. Not to mention they are falling behind on heat pumps to replace gas boilers. Heat pumps are meant to be installed however, there are many questions raised over their efficiency of them.
For the United Kingdom to be more sustainable, it isn’t just the government that needs to enforce these changes. Companies also need to make a difference themselves. Nonetheless, several businesses across the United Kingdom are making the right changes to be more sustainable. According to Beauhurst, renewable energy makes up 42.8% of total energy usage in 2021.
The UK produced 43.9m tonnes of commercial and industrial waste in 2019 and only 46% of this was recycled. Due to this, many companies are ensuring they use fewer single-use plastics for products. One of those companies is Toraphene, a company that was founded in 2018 to replace plastic carrier bags as its primary goal.
Xampla is another UK-based company looking to replace single-use plastics and they created the first plant protein material for commercial use. For example, there are many microplastics which are used in fabric softeners, shampoo and cosmetic products.
Even clothing brands are making a change. UK-based clothing brand, Pangaia, uses sustainable technology. Pangaia uses eco-friendly production methods as well as sustainable dyes for their tracksuits, bomber jackets, sneakers and hoodies. Although Pangaia is a more expensive brand compared to fast fashion brands that specialise in cheap hoodies and affordable full tracksuits, they are a step towards making clothing production more sustainable in the United Kingdom.