BCC Calls For Action As Exports Remain In Limbo
Image by Gerd Altmann from Pixabay
A survey of over 2,600 UK exporters has revealed that overseas sales growth has been effectively stagnant for more than a year, since the economy fully reopened after lockdown.
The BCC’s quarterly Trade Confidence Outlook for Q2 2022 showed the proportion of exporters reporting increased overseas sales to be unchanged from Q1 at 29%, while those reporting a decrease remained at 25%.
This compares to around 40% of businesses consistently reporting increased domestic sales across the same time period in the BCC’s Quarterly Economic Survey (QES).
Manufacturers trading overseas are under particular pressure, with only 39% expecting their profitability to increase in the next twelve months, compared to 48% of service sector exporters. This compares to 43% of all businesses surveyed in the QES.
Manufacturing exporters are also the most likely (78%) to expect to raise prices in the next year, a record high.
Almost nine out of 10 (89%) firms in this sector cite 'raw materials' as their biggest cost pressure, with 74% citing 'utilities' and 70% citing labour costs.
Responding to the findings, Head of Trade Policy at the British Chambers of Commerce, William Bain said:
“The combination of supply chain disruption, soaring prices, and the impact of Brexit red tape and compliance costs has had chilling effects on exports, especially for smaller firms already scarred by the pandemic.
“Recent ONS figures have shown an increase in exports to the EU, driven in part by shortages caused by the war in Ukraine. But our data shows there are serious underlying issues – which are hitting smaller manufacturing exporters the hardest.
“Any new Prime Minister must acknowledge the huge challenges being faced by our exporters - often the most dynamic, innovative and forward-thinking businesses in the UK economy.
“Then Government must help businesses to harness the opportunities provided by existing free trade agreements, and those coming on stream. Far too many firms are either unaware of the possibilities or are uncertain how to take advantage.
“Chambers of Commerce have the expertise and business network to help Government shift the dial. By working together, we can build an end-to-end support service for our exporters which could truly make a difference.”