Coatings sector warns of Brexit risks in major industry survey

A major survey conducted by the British Coatings Federation (BCF) has revealed some significant concerns of the coatings sector regarding the economic and regulatory landscape post-Brexit. Coatings are an important ‘enabling’ economic sector to other key industries, such as automotive and construction, allowing manufacturing to thrive in the UK, so being able to continue to have a competitive UK manufacturing base for paints, coatings and inks is critical to UK industry.

The survey revealed that the majority of coatings companies see Brexit as a risk, rather than an opportunity, with specific concerns surrounding both tariff and non-tariff barriers. Without free trade or the alignment of UK and EU chemical regulations, 10% of companies said they would consider moving their coatings manufacturing business operations to mainland Europe. Serious concerns were also revealed surrounding additional customs bureaucracy and availability of raw materials.

Sixty five percent of respondents were UK-owned SMEs and, not surprising, given the fact that the UK is a net exporter of coatings and printing inks; 86% of companies confirmed that trade with the EU is important to their businesses, with only one third saying that free trade agreements with the rest of the world would be beneficial.

The BCF, along with other trade associations in the chemical supply chain, recently met with representatives from the Department for Business, Energy & Industrial Strategy, the Department for Environment, Food & Rural Affairs and the Department for International Trade to discuss the survey results and urge government to ensure the UK remains an attractive place for UK and foreign companies to manufacture paints, coatings, printing inks and wall coverings. During the meeting, officials recognised the importance of the chemical industry supply chain to the UK economy and the challenges around aligning chemicals regulations post-Brexit.

Tom Bowtell, Chief Executive of the BCF said: "More than three quarters of our members said that a separate UK chemical regulatory system would be bad for business. Maintaining regulatory equivalence with key EU regulations (REACH, CLP and BPR) through continued relations with institutions, such as the European Chemicals Agency is essential to ensure we have a strong UK manufacturing base that can import chemical raw materials from Europe and export finished goods, such as paints, coatings printing inks and wallpaper without being at a competitive disadvantage. This is something we’ve made clear to government and will continue to throughout the negotiating process.”

Ellen Daniels, Head of Public Affairs and Policy at the BCF, said: "The survey forms part of the BCF’s Brexit work, which involves extensive engagement with government on the importance of our industry, following a roundtable with several government departments last year. Now that the Prime Minister has triggered Article 50, we urge the Government and the EU to negotiate a form of regulatory co-operation that allows current trade arrangements to continue and to ensure we avoid a bad deal or no deal at all.”