UKTI: Export to expand in 2014

Clive Drinkwater, UKTI’s Regional Director in the North West

As business optimism grows in the North West, Clive Drinkwater, Regional Director of UK Trade & Investment (UKTI) North West is urging companies to expand their horizons in 2014 and look to overseas markets as a way to boost trade.

He says that every company should make it a New Year’s resolution to ensure that their business plans feature an international section, and urges the region’s businesses not just to benchmark themselves against other regions of the UK, but against competitors worldwide if they are to achieve their potential in 2014 and beyond.

Mr Drinkwater says: “We enter 2014 with strong signals of a recovering UK economy and with trade and investment playing its part but not by enough. Our trade deficit in goods at the year-end was the biggest ever and as a region we need to address this.

“Businesses that export are, on average, 34% more productive, 75% more innovative, undertake three times as much R&D and are 12.5% more resilient than businesses that don’t.

“2014 will be a year of consolidating our recovery but let’s not be complacent. We need more exporters, we need more firms to look at opportunities in high growth emerging markets and we need to see more businesses investing in their technology, their people and their growth. The UK has only 0.8% of world population. Let’s make 2014 the year when we take on the other 99.2%!”

Expanding on the theme, he adds that opportunities for exporting should feature in all businesses’ plans for 2014 – and even if they are not ready to act on them immediately, to keep them in mind for future growth.

He also urges companies to look beyond the EU, adding: “In 2013, 50% of our exports of goods and services went to the EU, but this barely represents 7% of world population and only 19% of its GDP, so we have to look further afield.

“The EU is not growing but many countries are expanding much more rapidly, and we must have a global outlook to take advantage of where growth is happening.

“Everybody has heard the acronym BRIC, Brazil, Russia, India and China. These are all powerful economies in their own right and growing at some considerable speed and then there are countries like Mexico, Indonesia, South Korea and Turkey, which I pointed to as future growth markets in July 2013 and which I call the MIST nations.

“If you put these countries together, they represent an astonishing 50 per cent of world population and 33 per cent of world GDP and they are all seeing high levels of growth.”

Mr Drinkwater also recommends a few things to consider for future and current exporters, including learning to communicate in a the customers’ own language, taking the time to learn about cultural considerations and taking advice from experts such as UKTI North West, consulates and embassies.

He also encouraged service sector companies to get on board. He says: “Exporting is not just for manufacturers. In fact, since services make up 80% of the economy but only 33% of our exports, there is massive room for improvement. Since 2009, at the worst of the downturn, exports of manufactured goods have grown by 30% but of services by only 8%. Many firms in the services sector simply don’t consider international aspects, but they need to get involved.

“Our new minister, Lord Livingston, recognises that we have a vital role to play in attempts to transform the economy and to re-balance towards exporting. In 2013 I set a challenge to find 1000 new North West exporters – I hope that we can exceed this and really boost growth in the region in 2014.”