Coronavirus and UK Export – What’s the Impact?

According to British Chambers of Commerce (BCC) forecast released on March 17, it remains highly likely that the UK’s GDP growth will be reduced from 1% to 0.8% in 2020 – making it the weakest year of growth since 1992. However, in an effort to stabilise the economy during the coronavirus outbreak, the UK Government is urging exportation businesses (as well as others) to continue trading as normally and safely as possible as well as providing financial support for those affected.

In the short term, at least, there are going to be logistical challenges faced by business that reply on the exportation of goods. This is, of course, a direct result of the huge reduction in plane travel around the world because of the novel coronavirus. With passenger airlines normally handling a significant portion of the demand for air freight, we are now seeing a considerable bottleneck in terms of supply and demand as commercial freight airlines are under strain. In some cases, this is resulting in increased rates, delays, and an inability to export to certain affected areas.

However, despite the unprecedented disruption to freight movement around the world, the industry is working around the clock to ensure that businesses can continue to trade.

If you have concerns about your UK exports, speak to our team to see how we can assist your business

Which destinations are UK exports worst affected within the FedEx Network?

Italy

As of March 13, all domestic and international pick-up and delivery services are suspended within Bergamo. This includes (FedEx Express and TNT) and Como (TNT) stations.

Otherwise, exports should continue as normal from the UK.

USA

The European travel ban for people does not apply to cargo flights. Therefore, the FedEx Network will continue to provide their services for businesses exporting to the USA and Canada.

FedEx International Economy Heavy-Weight (IEHW), FedEx International Economy Freight (IEF), TNT International Economy Express, and TNT 12:00 Economy Express shipments should not exceed 2,500kg max volume per customer per day until further notice.

FedEx International Priority Freight (IPF), TNT 09:00 Express, TNT 10:00 Express, TNT 12:00 Express, and TNT Express services will experience a delay of 1 working day until further notice.

FedEx International Economy Freight (IEF), TNT 12:00 Economy Express, and TNT Economy Express will experience a delay of 3 working days until further notice.

China and Mongolia

There is an unprecedented demand for freight services to China. However, any cargo deemed as being medical, epidemic prevention supplies, and aids shipments will receive priority shipping.

FedEx International Economy Heavy-Weight (IEHW), FedEx International Economy Freight (IEF), TNT International Economy Express, and TNT 12:00 Economy Express shipments should not exceed 2,500kg max volume per customer per day until further notice.

FedEx International Priority Freight (IPF), TNT 09:00 Express, TNT 10:00 Express, TNT 12:00 Express, and TNT Express services will experience a delay of 1 working day until further notice.

FedEx International Economy Freight (IEF), TNT 12:00 Economy Express, and TNT Economy Express will experience a delay of 3 working days until further notice.

Air freight to Mongolia is currently suspended until further notice.

Vietnam

All FedEx and TNT services will have an additional transit time of 1 working day until further notice.

Hong Kong

FedEx services will have an additional transit time of 2 working days until further notice.

Guam

FedEx International Priority (IP) and FedEx International Economy (IE) will have an additional transit time of 1 working day until further notice.

Indonesia, excluding Batam and Medan

For every Monday delivery starting from March 9 – 23, FedEx International Priority (IP) and FedEx International Economy (IE) will have an additional transit time of 1 working day.

Which destinations are UK exports worst affected for DHL?

Austria

Resulting local restrictions, pick-up and delivery services have been suspended in the following postcode areas, until further notice:

Innsbruck: 6553, 6555, 6561, 6562, 6563, 6580

Kufstein: 9844

Bulgaria

Basko has entered a lockdown, meaning all pick-up and delivery services to postcode area 2770 have been suspended until further notice.

Czechia

Local restrictions have caused a suspension of service to the following postcode areas:

Litovel (783 21, 783 31), Cervenka (784 01), and Unicov (786 81, 783 91, 783 93).

Italy

DHL Express is still widely available across Italy. However, there are some local government restrictions in the worst affected areas, including:

Ariano Irpino (83031), Polla (84035), Sala Consilina (84036), Atena Lucana (84030), Caggiano (84030), and Medicina (40059).

Portugal

Local authorities have locked down the city of Ovar (district Aveiro). As a result of this, all pick-up and delivery services have been suspended in postcode areas to 3880-XXX to 3885-XXX.

Spain

Personal protective equipment (PPE), such as filter masks and gloves cannot be imported to Spain without a special import license. All of the affected imported products to Spain can be found here.

Turkey

Local authorities have suspended pick-up and deliveries in Northern Cyprus. Therefore, customers will have to pick-up their shipments at a designated service point.

China

DHL Express is still shipping to China whenever and wherever possible, with the majority of service now being fully re-established. However, service to Wuhan (WHU), Hubei province, will remain suspended until further notice.

Iran

Service to Iran is limited to diplomatic material and OFAC licenced goods. Service has been re-established with different air routes.

Libya

There is currently no service to Libya.

Iraq and Jordan

Services are delayed as a result of suspended flights.

Djibouti, La Reunion, Sudan, Somaliland

Services are delayed.

Somalia

There is currently no service to Somalia.

UK export restrictions are not set in stone

It’s important to remember that this pandemic is an entirely fluid situation, meaning country-specific restrictions may change at any given time. Additionally, the availability of passenger air travel is also subject to change, meaning that the demand of space on commercial cargo airlines may increase or decrease at short notice. As previously mentioned, selected goods, such as emergency medical supplies, may also require priority shipping over other non-essential cargo.

Can UK export businesses receive financial relief?

Coronavirus and its impact on UK exports has left many businesses feeling financially pressured, whether that be in regard to their employees and sick pay, a loss in revenue, or regular financial obligations. Thankfully, on 17 March, the UK’s Chancellor, Rishi Sunak, announced a financial relief plan designed to address many of the challenges businesses across the UK are now facing. In effect, this (currently) amounts to £330 billion in state loans, as well as an additional £20 billion in financial handouts to the most severely hit businesses as a result of the coronavirus.

UK Export Finance (UKEF)

In addition to the measures set out by the UK Chancellor, exporters can receive assistance from UKEF – It provides guarantees, loans, and insurance on behalf of the government. This should help to protect UK exporters that are facing disruption from transit restrictions and delayed payments.

Bank loans can be guaranteed through UKEF if your business is facing delayed payments. This is fulfilled through its Export Working Capital Scheme. If your business is concerned that it may not be paid, UKEF provides an export insurance policy that will help your business to recover any costs lost from orders being terminated outside of your control. However, to help keep trade moving, UKEF also offer a Direct Lending Facility scheme for overseas buyers, so that they can continue to purchase your goods if under pressure themselves.

Do you have any questions about coronavirus and UK export?

For further information and advice, please contact our experienced team now.

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