Brexit worse than feared, says JD Sports boss

BBC.- The boss of one of Britain’s big retailers says Brexit has turned out to be «considerably worse» than he feared.

Peter Cowgill, chairman of JD Sports, said the red tape and delays in shipping goods to mainland Europe meant «double-digit millions» in extra costs.

He told the BBC JD Sports may open an EU-based distribution centre to ease the problems, which would mean creating jobs overseas and not in the UK.

The government said it is providing businesses with support.

Mr Cowgill’s criticism echoes that from exporters and importers across the UK.

New UK-EU trade rules came into operation on 1 January. But since then, there has been growing concern from businesses as diverse as seafood exporters from Scotland and food suppliers shipping products to Northern Ireland.

Mr Cowgill told the BBC’s World at One that there is no true free trade with the EU, because goods that JD Sports imports from East Asia incur tariffs when they go to its stores across Europe.

He said: «I actually think it was not properly thought out. All the spin that was put on it about being free trade and free movement has not been the reality.

«The new system and red tape just slows down efficiency. The freedom of movement and obstacles are quite difficult at the moment. I don’t see that regulatory paperwork easing much in the short term,» Mr Cowgill said.

‘Bizarre’

Opening a big warehouse distribution centre in mainland Europe «would make a lot of economic sense,» he said. He estimated such a facility would employ about 1,000 people.

While JD Sports’ existing warehouse in Rochdale would not close, «it would mean the transfer of a number of jobs into Europe,» Mr Cowgill said.

He also warned that the UK needed a complete overhaul of business rates and rents if the High Street was to survive. «It is basic economics,» he said. «Bricks and mortar retailing is becoming uneconomic.»

Mr Cowgill had particular criticism for the government’s decision-making on forcing non-essential shops to close, while allowing essential shops to stay open.

In reality, that meant supermarkets could sell clothes, while firms such as JD Sports had to shut. «Some essential retailers have been making hay out of selling clothes, whilst clothing retailers have been closed. It is bizarre,» he said.

The Cabinet Office said in a statement: «We know that some businesses are facing challenges with specific aspects of our new trading relationship, and that’s why we are operating export helplines, running webinars with experts and offering businesses support via our network of 300 international trade advisers.

‘We will ensure businesses get the support they need to trade effectively with Europe and to seize new opportunities as we strike trade deals with the world’s fastest growing markets and explore our newfound regulatory freedoms.»

‘Erroneous’

Last weekend, the Road Haulage Association (RHA) said exports to the EU had fallen as much as 68% since 1 January due to Brexit border hold-ups.

But the government has said freight movements are now close to normal levels, despite the Covid-19 pandemic.

On Monday, Cabinet Office Minister Michael Gove told a committee of MPs that the RHA’s claims were «erroneous» and «based on a partial survey».

He added that «truer figures» were published on the Cabinet Office website, adding that the port of Dover saw 90% of normal levels of traffic on Monday.

Mr Gove acknowledged that traders faced issues with exports and imports to and from the EU, but said it was «important to put it in context».

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