Call for more support for exporters
A new report has found that manufacturers are looking to the government to provide extra backing for firms that want to export their goods.
The study, compiled by the British Chambers of Commerce (BCC), surveyed some 500 UK manufacturers.
It revealed that many British firms are concerned about the obstacles that still exist for exporters.
While the UK is the seventh largest manufacturer in the world, it has witnessed a decline in its overall global share.
For manufacturing firms, lack of trade finance is often a key barrier to exporting.
Problems during the recession, coupled with a lack of access to export finance for riskier markets, have left many British exporters in a weak position compared with rivals from exporting nations with access to state-backed schemes, the BCC argued.
To help improve the situation, the BCC put forward the case for the creation of a state-backed trade credit insurance scheme; for the broadening and simplification of R&D tax credits; for clarification of the likely impact of a reduction of Capital and Investment Allowances on manufacturing firms; and for better promotion of UK trade.
Specifically, the study showed that 27 per cent of respondents didn’t export at all, while a further 15 per cent only made 10 per cent or less of their turnover from international trade.
However, a third (34 per cent) exported over half their turnover, while 39 per cent exported under half, and a fifth (20 pr cent) exported under 20 per cent.
Some 46 per cent of exporters said that their export volumes had grown during the past five years, while only 11 per cent said they had shrunk. For 41 per cent, export volumes have held constant.
Eight out of ten firms (82 per cent) saw export controls as an issue for their manufacturing and export potential, followed by the price of sterling, regulation and access to finance.
To help boost export drives, UK manufacturers said they want continued low interest rates (38 per cent); better export support from the Government (33 per cent); and improved access to growth capital (22 per cent).
David Frost, the BCC’s director general, commented: “Britain’s manufacturing industry is alive and well; strong, productive and innovative. No longer the Cinderella sector, it is the powerhouse of the UK and will play a vital part in securing our future economic growth.
“But this revival has to be lasting and sustainable. The Government must prescribe the right policies to encourage growth and allow manufacturers to export their way out of the recession. ?
Mr Frost pointed out that British exports haven’t grown as predicted, despite the competitive valuation of sterling, and added that industry needs to become far more proactive when it comes to exporting.
But while businesses must look for export opportunities for their products – especially in high-growth developing markets – Mr Frost also argued that the Government must play its part too.
He concluded: “Long-term Government support is vital. State-backed trade promotion and improved export support will stimulate the UK’s current and future exporters. Governments in all major developed economies provide business with international trade services to help them to access new markets. The UK must do the same. We urge the Government to think manufacturing in everything that it does.”