Healthcare manufacturers in the UK making good use of monopropylene glycol and more could find that a hard Brexit impacts them particularly, with goods exposed to new and different costs each time they go from the UK to the EU.

A new report from law firm Baker McKenzie and consultancy Oxford Economics has suggested that these costs would come in the form of both non-tariff and tariff barriers, which would mean companies have to increase domestic sales or export to third markets in order to offset the expense.

It was also found that to target these new third markets, manufacturing exports in the UK would have to rise by 60 per cent so as to offset any export losses as a result of a hard Brexit.

Baker McKenzie trade partner Ross Denton said: “We have heard a lot about how much Europe exports to the UK, for example, in the automotive sector. That may be true in numerical terms, but when you look at this as a percentage of their trade, you can clearly see that the EU exports a lot more broadly, to a whole host of other markets, and consequently, it is far less dependent on the UK as a market than the UK is on it.”

This comes as the Bank of England warns that lending to companies could drop after Brexit has taken place because of insufficient preparations being made by firms in the EU to continue operating in this country after March 2019. It advised that businesses would have to begin seeking authorisations in the first three months of 2018.