Small businesses are expecting to increase overseas trade in 2015 despite a disappointing year from Britain’s export sector.
A whopping 78 per cent of SME exporters believe that 2015 will be a better year for their trade than 2014, new research from government-backed exporters’ forum Open to Export has found. Just three per cent believe that 2015 will actually be a worse year for exports than 2014.
Data released by the Office of National Statistics showed that business investment was down, implying a weakening confidence in the sector. This newest report, however, serves as a slight confidence boost.
But ONS data also showed that the UK’s trade deficit widened from £8.9bn in the second quarter of 2014 to £11.2bn in quarter three. Trade is actually having a net drag on the economy.
The government intensified its effort to boost exports in October by allowing UK Export Finance, the government’s main tool for offering financial support for exports, to participate in its first ‘direct lending’ transaction with the Dubai World Trade Centre. The UKEF provided half of a $110m loan to the centre, with the other half coming from Deutsche Bank to help support a Carillion construction contract.
Critics have said the scheme does not do enough to support small businesses. Small business bodies hope that Chancellor George Osborne will use next week’s Autumn Statement to rollout measures to support small businesses. In the meantime, the Federation of Small Businesses (FSB) is calling for infrastructural investment, tax simplification and business rates reform.
The government wants the UK’s export sector to double in volume to £1tn by 2020.
It also wants to get 100,000 companies exporting for the first time by 2020. However, given the weak numbers for 2014, the industry is still way off that mark.