External pressures continue to ease
Although Brexit is seen as the biggest risk to growth in the current market environment with 36% of businesses citing this as a significant issue, this is down from 39% in the previous quarter. It provides further evidence that companies are coming to terms with the UK’s departure from the EU.
When it comes to future risks, UK economic slowdown (43%) and Brexit (43%) continue to be the main sources of negative impact on business over the next 12 months. However, there is less concern about a domestic slowdown compared to the previous quarter (down by 4%), and worries over Brexit have picked up slightly (up by 2%).
Currency fluctuations still appear as a concern (35%), although level of concern has decreased compared to the previous quarter (40%). Sluggish growth in key markets – whether domestically or overseas – is also seen as a major risk by 35% of respondents.
Meanwhile, among businesses which plan to start trading internationally in the next 12 months, concern about external factors such as geopolitical risks and interest rate changes appear to be highest: 77% of such firms say these threats could restrict their ability to hire new staff, while 76% say they could hinder expansion into foreign markets.
Recognising international identity
The Trade Barometer suggests many UK businesses do not fully recognise their international exposure.
Among those firms who identify themselves as purely domestic in the survey, 24% say they sell goods or services outside of the UK, 31% purchase goods or services from overseas suppliers and 18% have customers based outside the UK.