Week Ahead in International Trade: BTOM finally here, BoE’s first rate decision of 2024 and Red Sea

Tue 30 Jan 2024
Posted by: Phillip Adnett

This week is a big one for UK trade, with tomorrow (31 January) the day when the first stage of the Border Target Operating Model (BTOM) is introduced following months of anticipation.

BTOM: The first stage of the phased introduction of the BTOM will see new documentary requirements being introduced for EU businesses sending certain animal and plant products into the UK from Wednesday. On 30 April, border checks are due to begin on goods entering the UK, while a new requirement for safety and security declarations on EU imports is due to come into effect 31 October.

Traders are urged to keep an eye on their news feeds for any last-minute developments. Last week, the Department for Farming and Rural Affairs (DEFRA) issued a major reclassification of risk categories for fruit and vegetables under BTOM, with trade experts warning of the lack of communication.

The IOE&IT Daily Update will keep you up to date with the latest changes as they come.

Waiting on the BoE: The Bank of England is set to make their latest rate decision on Thursday (1 February).

Economists are largely predicting a hold of the BoE’s base rate, following the European Central Bank’s (ECB) decision to keep interest rates low, with ECB predicting cuts later during the year.

This week in Parliament: It’s a busy one for trade matters. Today (30 January), we might get an idea of the progress the UK has made on rejoining the Horizon Europe project. Tomorrow, meanwhile, Kent-based businesses are due to give evidence to the European Scrutiny Committee on matters related to the UK/EU Border and the changes coming under BTOM.

Red Sea: Following an attack in the Red Sea that set an oil tanker ablaze, as well as an attack on a US military base that left three dead, all eyes are likely to be on the troubled strait for the foreseeable future.

Energy markets have been relatively stable since the start of the crisis, but the attack on the oil tanker over the weekend has set off speculation that oil and gas prices could rise in response. Contracts for Brent crude rose by 1.5% shortly after the attack.

Meanwhile, US president Joe Biden is facing increasing pressure to respond to the attack on US military personnel. Although Iran has denied involvement, Biden has blamed “radical Iran-backed militant groups” for the attack and promised to hold these groups to account.

Military sources told Politico that response options are being drawn up “as we speak”, while opposition Republican senators called for retaliation, although officials have said that the US does not want the conflict to broaden.

Other dates for the diary

Monday: Final candidates announced in the Welsh Labour leadership contest

Tuesday: ASLEF train drivers start their week-long strike

Wednesday: Start of first phase of BTOM, CBAM reporting requirements enter force and 999L waiver ends

Thursday: Start of LBGT+ Month and US Black History Month

Friday: the UN Food and Agriculture Organisation releases its Food Price Index, the annual measure of the monthly change in international food prices

Saturday: Setsubun, a celebration in Japan marking the beginning of spring under Japan’s old Lunar calendar

Sunday: Elections in El Salvador, with president Nayib Bukele widely expected to win re-election