2015 may have looked like the best year yet for small businesses with overseas ambitions, but growing anti-EU sentiment has begun to nip these plans in the bud.
A new survey by the Federation of Private Business (FPB) suggests that small businesses are struggling to develop relationships with companies on the continent, many of which are worried about what will happen if the country was to leave the European Union.
“There is a fear that anti-EU rhetoric and the doubt over the UK’s future EU membership is already making it hard for some UK businesses in Europe,” the FPB report said.
This means that, whereas last year 15% of member SMEs told the FPB that they planned to begin exporting overseas, that number has now dropped to 9%. Meanwhile, 58% of companies that were exploring overseas opportunities have now decided to focus their energies on domestic customers – making the government’s target of hitting £1 trillion in exports by 2020 look increasingly unlikely.
Commenting on the findings, chief executive Phil Orford said: “Europe is the most important market for small business owners but uncertainty over the European recovery, UK membership and poorly introduced regulation is creating unnecessary barriers for Britain’s exporters.”
“Our members are detecting that European businesses wanting to form long-term relationships are concerned about these uncertainties and are reluctant to use UK suppliers where they have access to others within Europe offering the same product and service levels.”
While none of the three major UK parties have said that they would want to leave the European Union, pressure from the right-wing nationalist party UKIP has led the Conservative-led coalition government to take a more aggressive stance on the country’s relationship with Europe.