The latest ONS trade statistics have revealed that the deficit in the first quarter of 2016 was £13.3 billion – but the FSB believes small businesses can help to turn this around, if only they are given the support they need.
Biggest Trade Deficit in Last 5 Years
Although Barclays’ Business Abroad Index showed that exports in some sectors had improved in 2015, the wider picture is not so rosy. This trade deficit is the biggest for any calendar quarter since the first three months of 2008.
“We have not seen a quarterly trade deficit of this size since the early days of the financial crisis,” said Mike Cherry, National Chairman of the FSB. “The government has a real challenge ahead if it hopes to meet its target to increase the value of exports to £1 trillion and support 100,000 new exporters by 2020,”. “Small businesses can make a significant contribution to this target but they need tailored support.”
The Cross-Government Exports Implementation Taskforce
In January, Lord Maude, the Trade Minister at the time, announced a new whole-Government plan to boosting British exports, centred on a revamped UKTI and implemented by the Cross-Government Exports Implementation Taskforce under Business Secretary Sajid Javid.
Speaking about the plan at the time, Mr Javid said: “To improve the UK’s export performance we need to get the whole of government mobilised and working towards the same goal. By putting a refocused UKTI at the centre of a co-ordinated cross-Government approach relevant departments will share expertise to get UK businesses exporting.”
In April, the government boasted that there had been over 20,000 applications from UK businesses to export opportunities through their new Exporting is GREAT website, and that a ‘new chance for UK companies to export’ was ‘uploaded every 37 minutes.’
Export Support: Too Little, Too Late?
However, it seems this may be too little, too late. In his resignation speech in February, Lord Maude admitted it was “a huge task to turn round the UK’s flagging export performance,” and that while the new plan would “increase the practical and financial support for exporting businesses… implementation of all this will take several years.”
“Our own research shows small business confidence at its lowest level since 2013 alongside a worrying decline in export performance among small firms,” says Mike Cherry. “As the new Minister Lord Price takes over the export brief within government, we will be urgently discussing with him how to make funding and support more effective for small firms looking to export.”