Economically speaking, the UK is doing great – particularly when compared to other developed nations. The Office For National Statistics has reported the last quarter of 2015 saw a 0.5% growth – the 12th consecutive quarter of growth. While it’s slowed slightly over the last three to four years, the BBC have said that the UK’s economy is one of the fastest growing in the world.
While consumer spending is a strong short-term way of stimulating growth, exports and business investments are needed for a longer term pattern of positivity. The IMF have said that the global economy is ‘vulnerable’ – so how is this affecting current UK exports, and how is the state of this are positively contributing to growth?
UK-based container experts LCS Container Services, who can support businesses needing to ship overseas on large scale, look at the current situation and what the picture looks like for 2016.
How Did the State of UK Exports End in 2015?
Economic growth around the start of the year (so indicative of 2015) were slightly wobbly overall, which some have pointed to as a tough start to the next 12 months. However, strong growth in certain areas, and growth across the board in exports to the UK’s leading partner countries creates a much more positive image.
Earlier this month Barclays released what it called the ‘New Business Abroad Index’, which gives an insight into export trends in the UK. Europe has been the most popular destination for UK exports in the last 12 months, with Germany being the leading export partner, and also experiencing 6% uplift off 2014’s export figures.
France took the second spot, overtaking the United States – which still is the UK’s third biggest export partner. The UAE is the 10th biggest export partner, and exporting to China has also reportedly grown by 21%; despite suggestions that lesser-known lucrative markets (such as Singapore) are being missed by UK businesses, it’s a positive trend that UK exports are making it far beyond Europe in growing numbers.
Which Industries Have Contributed The Most?
Broadly UK exports are getting stronger, but there are some industries which are faring far better than others. A previous post on Warehouse & Logistics News discusses how some areas of manufacturing have been supporting strong export growth, which you can read here. As an example, the UK’s car manufacturing industry’s export figures hit a 10-year high – and the industry’s export output grew by 3.9%.
Other industries have also grown, and some more so than automotive manufacturing; retail exports grew by 36% and exports from the manufacturing sector as a whole grew by 10%.
Looking to the Future – Expert Predictions for 2016
Currently, a weaker pound (particularly when compared against the Euro and other currencies in major export partner countries) isn’t necessarily entirely bad – it does have positives. In a post for Warehouse & Logistics news earlier this year, Ernst Wagner, who’s the managing director of Kasto UK, discussed how this works in the UK’s favour; a weaker pound means cheaper goods for other companies, making it much easier to sell goods abroad.
However, current figures suggest that only one in five UK businesses in the manufacturing sector specifically take advantage of exporting goods – and with a positive climate to selling abroad, this can easily be higher. 2016 is being touted as the perfect time for UK businesses to invest resource in exporting as the returns are very likely to be strong.
There are a number of incentives and schemes to support businesses in this type of investment. The government’s UK Trade & Investment organisation offers a number of support services to boost businesses looking to sell abroad, including events, guides and financial support. If utilised by businesses, the climate and support available for those unfamiliar with the market could lead to continued positive growth for UK exports.
What we’ll hopefully see is, this time next year when 2016’s reports are released, we’ll be able to discuss an even more positive picture – export growth and, most importantly, a pick-up in the pace of UK economic growth.