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Why Boris is no friend of exhibitions

by EN

EN guest editor Phil Soar laments the impact of Brexit on the exhibitions and trade show sector, opining that the full effects have been masked by the pandemic, but that the truth will out soon enough.

I am sitting in the car in a very long queue hoping to buy petrol, having just discovered that Tesco has no ice cream, tonic water, or dog food, and musing that Boris Johnson is an astonishingly lucky politician.

Sitting a thousand miles from real power, he was the obvious winner from David Cameron’s suicidal decision on the 2016 Referendum. Judging the odds perfectly, Johnson’s ‘honourable decision to support £350m on the side of a usefully passing bus left him sitting outside Downing Street. He happened upon the rump of a Cult Conservative party with 120,000 members, so atypical of the population at large that they ignored a personal history and probity which would have destroyed any previous candidate. And he ended contesting an election against Jeremy Corbyn, an opponent Postman Pat would have crushed.

But his greatest stroke of political luck has been Covid.

The human losses of the pandemic are of a magnitude all on their own.

The smothering of the effects of brexit

But politically what Covid has done is to smother the effects of Brexit. The consequences of not only the June 2016 referendum but, as bad, the determination of this Government to abandon the Single Market and the Customs Union, have been buried in a period dominated by the pandemic.

(And I am still sitting here writing this article in the queue, hoping for fuel, thinking that one of the major objectives of Brexit – research shows the biggest objective for the 51.8% – was to reduce the number of European immigrants. And having managed to achieve just that, our Brexiteer Government’s clever solution to solve the resultant problem is now to bring back lots more European lorry drivers and agricultural workers…).

The greatest economic disaster of Covid is likely to be that Johnson will always pretend that it is impossible to disentangle the economic effects of Brexit from Covid.

So why say so in a piece devoted to trade shows?

The key is the word trade, trade, trade. It’s in the title. The campaign for Brexit, and the vote to go down that route, was a vote to diminish trade. The EU is the largest trading block in the world. With the Single Market and the Customs Union, we were part of a 500m market with whom we could trade freely and with, in effect, virtually no constraints – in either paperwork or tariffs. A vote to leave that community was a vote to decrease and damage that trade, and to put up barriers to obstruct future trade. This is not contentious – it is simply a statement of the obvious.

I am not arguing that reducing Trade was the primary objective of all those who promoted Brexit – but it was always transparent that it would be a damaging side effect. And we all know where Boris stands. Famously, asked (in 2018) about concerns over a hard Brexit, Mr Johnson is reported to have replied: “F*** business.” He refused to deny this.

The key is in the title: trade, trade, trade

Those of us who live in the UK now must work in a country which has actively chosen to reduce its trade and economic links. The UK, particularly after Afghanistan, cuts a lonely and confused figure in the world. None of the great new trade deals Boris had promised are in the offing and a sweetheart deal with the US is surely now dead (on 21 September, Biden made it clear that the UK was “at the back of the queue” for any deal). The ‘globalising world” of which we were to take such advantage is in retreat.

Although we are moving towards the end of 2021, there can be no incontrovertible statistics for the effect of Brexit – because of Covid. But at the end of July the ONS published their first findings. The share of service (e.g., financial) exports to the EU had fallen from 37% to 35% over 24 months. But the share of EU imports which the UK represented had fallen from 46% to 37%. On 14 September the International Economic Review (not a UK body) published a paper showing that the UK was already 2.9% poorer, in economic GDP terms, than it would have been had there been no referendum – and this gap continues to grow. But then we have “taken back control”; so that’s alright then.

On 1 August, The Economist published the latest stats on Gross Domestic Product performance over the prior 12 months. Of the 43 largest economies in the world, guess which came bottom? Yes, surprise, surprise: the UK with a 6.1% decline. By comparison, the US was +0.4%, the EU overall -1.3%, Germany -3.1%, France +1.2%, Italy -0.8%. Every single one of those 43 economies has suffered from Covid and from the economic disruption it caused. And yet no one came near the UK in this particular medal table. Spain, with -4.2%, was the closest.

The stats keep coming: in 2021, British car manufacturers will produce no more than 950,000 vehicles, the lowest annual figure since the 1970s. The year of the Referendum, 2016, we produced 1,700,000. Yes, the pandemic has had an effect – but compare the same stats for France, Germany, Spain and Italy and you will see a very different picture.

So which part of culture, media or sport are we?

All of this has an effect on ‘trade’. I am not so foolish to be certain of where we will be in 2025 (as Dominic Cummings said recently: “Anyone who said they could predict how Brexit would work out is mad.”).

But I do know that Brexit must have damaged the trade show industry in the UK – though naturally all our major companies now derive far more of their revenues from elsewhere (and will be even less inclined to invest here in the future).

I cannot put a number on the European companies who no longer think it will be worthwhile exhibiting at shows in the UK (though I can name specific companies who have said that they are reducing their efforts in the UK and no longer want to exhibit). Or how many UK companies are no longer exporting to Europe because of the onerous paperwork and bureaucracy (the tariffs are rarely much of a problem – something that was always misunderstood in the debate).

And don’t get me started on how our industry was treated during the pandemic, how it is regarded as part of the Department of Culture, Media and Sport as opposed to it being a valuable part of the business environment (and that is just plain weird, isn’t it – which of Culture, Media and Sport are we deemed to be?). And how in October 2020 the Government agreed to let the Albert Hall run eight concerts with 2,500 attendees but, a mile down the road, wouldn’t let Olympia run an event with 100 people.

The SaSie reports on our industry in 2017, 2018 and 2019 were (in my view) already showing the effects of Brexit. There had been a clear and steady increase in square metres sold (a good proxy for revenues) from 2010 onwards. But in 2017 – the year after the Referendum – that came to a halt. From around mid-2016 onwards through to 2019 we saw a decline in square metres sold averaging around 1% per annum at UK trade shows.

Sadly, it will not be until 2023 or 2024 that we will have another set of statistics to work with – and these can only really attempt to compare with 2019. Until then, we are flying blind. Maybe the post-Referendum decline is co-incidence, maybe it is correlation, maybe it is consequence. We will never be able to prove it beyond reasonable doubt – but we do have a plentiful stock of anecdotes.

Boris and the hippopotamus

And so how is Johnson & Co working to improve our lives – on what does our government concentrate? The Irish Sea remains their nightmare. In August they issued complex protocols to cover the massive post-Brexit trade issues which will arise in the event that a hippopotamus crossed the Irish Sea from Liverpool to Belfast (I promise, I am not making this up – and you will be relieved to read that if you want to transport a Hippo from Belfast to Dublin you won’t need any paperwork at all). It is not clear whether the Hippo is expected to swim or not.

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