TOY exports from Spain to the UK have shrunk in the last nine months due to the uncertainty surrounding the impending Brexit process and the fall of the pound sterling against the euro.
The Spanish Toy Manufacturers' Association (AEFJ) says it had been seeing growth of nearly 18% per annum until the EU referendum led to a 'leave' result, and that 2016 had been its worst year of the decade for UK trade.
This does not mean the industry is struggling per se, however, says the AEFJ – already very international, Britain was its fourth-largest market and has now dropped to fifth behind Germany.
But purchases from the United Kingdom have definitely dropped, the AEFJ says, coinciding with the devaluing of the sterling on the very day the referendum results were known, on June 23.
Back in 2013, toy manufacturers in Spain – mostly based in the south-west of the province of Alicante, in towns such as Biar and Tibi, where the industry is overwhelmingly the mainstay of the local economy – sold just under €424 million of their wares abroad, or 7.1% more than in 2012, and thought at the time that it was their poorest year since the financial crisis.
With figures of €454m, representing an increase of 17.6%, in 2014 and then a 14.2% rise to €519m in 2015, Spanish toy exports were flying.
But with British firms' spending power drastically cut through the pound sterling dropping from an average of €1.32 to €1.40 down to between €1.15 and €1.20, growth in exports fell to 2.77% for 2016, with total foreign sales of €533m.
British purchases fell from €35.14m in 2015 to €31m in 2016, a decline of 11.77%, says AEFJ chairman José Antonio Pastor.
UK wholesalers and retailers typically buy toy cars – mainly the larger type pulled along by string, or electronically-powered – as well as wendy-houses, swings and, to a lesser degree, dolls and other figurines.
Portugal has helped lessen some of the damage caused by plummeting UK imports, having purchased 9.56% more in 2016 and knocking France off the top spot, with Spain's other neighbouring country registering a 6.58% increase.
Italy saw the third-highest national growth in imports from Spain's toy factories, at 1.98%, just ahead of Germany, and Greece was sixth behind the UK.
The USA is not a huge market for Spanish toys, but it showed a fall of 15.51% with the devaluation of the dollar linked to Donald Trump's winning the national elections.
Much smaller markets showed a massive increase, however – Poland's purchases went up by 60% to over €12m, and The Netherlands by 13.82%.
Pastor says he hopes negotiations between Brussels and the UK will be 'reasonable' after Article 50 is triggered on March 29, since both Britain and the EU 'depend heavily upon each other' for trade relations.
He believes it would 'not be logical' to expect a decline in bilateral commerce between the remaining EU-27 and Britain or to 'put in danger something that is so strongly consolidated'.
Also, he does not think it 'in the UK's interests' for the sterling to continue at such a low level, given that it is a country which 'relies heavily on international markets'.
This said, the toy industry in Spain is one of many commercial and individual communities which are 'very concerned' about what might happen next – especially with the pending general elections this year in France and Germany creating more uncertainty as fears of the far right gaining power become increasingly real.
These factors 'do not benefit business growth', says Pastor, who adds that although the recent terrorist attack in London has not produced an 'immediate' effect on UK consumer spending linked to foreign trade, it 'could lead to instability and affect buyers' behaviour long-term'.
