The European Union is a major import and export force in the trade world. EU countries account for more than 15% of the world trade in goods. While the EU exports a considerable amount of goods, the amount of imported goods by weight is almost three times higher than that of exported goods during the period from the year 2000 to 2015. Import is mostly dominated by raw materials, fossil fuels and agricultural resources, while the export is based on finished products and high value goods like machinery and tools.
The amount of imports in the EU have been steadily increasing from the year 2000. By 2008 imports have increased by 23.3% with some major impacts happening during the economic crisis in 2008. Following that, the amount of imports from 2008 to 2015 fell to the level of imports present in the year 2003. This is apparent on the following graph. (Source: Eurostat)
EU-28 Imports, exports and trade balance, 2000-2015 (Index 2000 = 100) - Eurostat
As previously stated, the amount of physical goods imported is way higher that the amount of goods exported. Average annual import for EU is 3,2 tonnes per capita, opposed to 1 tonne per capita for exports. In 2015 the amount of imports fell to levels lower than those of years before crisis, with 2,5 tonnes per capita.
The following graph details the amount of trade of physical goods from years 2000-2015 and clearly shows the falls in tonnage in years 2008 and 2009, years of the economic crisis.
Physical trade of goods by main material category (tonnes per capita, left Y-axis) and monetary trade of goods (euro per capita, right Y-axis)(¹); EU-28, 2000-2015
The amount of import varies highly by goods and the state of manufacturing. Raw goods take the largest share of imports with 2,1 tonnes per capita. Raw goods are followed by semi-processed products with 0,5 tonnes per capita and finished products with 0,4 tonnes per capita.
The goods that are imported the most are fossilized energy materials, minerals, biomass and metal ores. Fossil energy materials take up most of the imports with 2,1 tonnes per capita. Metal ores are the second most imported material with 0.4 tonnes per capita, biomass is the third with 0,35 tonnes and non-metallic minerals forth with 0,1 tonnes per capita.
Most of the international and intra-Europe import and export seaborne freight traffic is done by the sea. The biggest share of seaborne freight traffic is held by the North Sea ports. These ports account for 31,7% of freight traffic. They are followed by the ports located on the Mediterranean Sea (28.2%), Baltic Sea ports (17.3%), UK & Irish ports (15.3%), Atlantic Ocean coast (5.9%) and Black Sea ports (1.7%) with the smallest share in traffic. (Information taken from the study: Modal share of freight transport to and from EU ports, 2015)
So, who are the biggest importers in the EU? The following table details the amount of containerized goods by top 10 importers in EU in years 2013 and 2014. All of the units are described in TEU’s. (Source: IHS Global Insight, World Trade Service)
Belgium and Luxemburg
Source: IHS Global Insight, World Trade Service
Even though that EU imports a lot of goods, the top EU importer - Germany is only 6th on the global scale. The largest importer in the world is USA with 19,6 million of TEU’s imported in 2014 and 18,4 million of TEU’s in 2013. USA is followed by China, Japan, South Korea and Indonesia.
Accumulative EU import for the year 2014 was 17,5 million of TEU’s and 16,2 million of TEU’s in 2013, which is still lower than the amount of annual imports done in USA.
United Kingdom takes the second place in EU’s trade. Closely following Germany, UK imports 2,6 million TEU’s on average and exports a lot to the mainland Europe. That is set for a possible change following the UK’s exit from the EU.
So, what does Brexit means for the UK’s import and export trade?
UK leaving the free trade zone could lead to a lot of different scenarios. This could lead UK’s customs to impose new rules, including control of origin, increase of VAT and more complicated import duties. Best possible scenario is UK striking a deal with EU to stay in the the European Economic Area, which would mean that UK could avoid imposing additional import duties because they would still be in the free trade zone. Even with this, UK would still have to regulate and cross-check the origin of goods to be certain that the goods were produced in the EU.
With all these possibilities, United Kingdom still faces a lot of challenges after Brexit, and the future of UK’s post-Brexit trade still remains uncertain.