The Spring 2021 edition of the Trade Barometer reveals that UK businesses are increasingly global in their ambitions. While concern about the practicalities of the UK’s post-Brexit trade agreement with the EU may be undermining confidence in sales to Britain’s nearest neighbours, many businesses are excited about the opportunities that lie further afield.
On a regional basis, 32% of companies taking part in the Trade Barometer research now view North America as most likely to generate growth for their business over the next three years, ahead of the EU, cited by 31%. That represents a significant shift from the Autumn 2020 Trade Barometer, when British businesses were still more likely to favour the EU as a growing export destination.
Other regions also loom large on the radar of exporters. Almost a quarter of businesses (23%) now expect significant growth from markets such as Australia and New Zealand, which have weathered the pandemic more successfully than many other countries. More than a fifth (21%) are looking to Greater China to increase their overseas sales, with a substantial rebound in growth in the region now expected over the next 12 months.
The Middle East, picked out by 20% of respondents, is also an attractive export destination for many UK businesses. And growth prospects look strong across Asia - 19% of respondents are focusing on the Indian sub-continent, the same number cite Japan and South Korea, while 16% point to Southeast Asian markets.
The lure of America and China
Turning to individual countries, 31% of businesses now believe the US is the market where their growth prospects look most attractive over the next 12 months. Indeed, the US is some margin ahead of the next most favoured countries, with 17% picking out China and the same percentage picking Australia. Closer to home, Germany and France are regarded as leading sources of growth by 16% and 12% of respondents respectively, underlining the ambition of UK businesses to look further afield for export success.
In fact, the appeal of both the US and China continues to grow. In the Autumn 2020 Trade Barometer research, these countries were selected as number one markets for growth by 27% and 14% respectively. In both cases, there are clear drivers for increased positivity. The US economy looks set for a substantial boost by the unprecedented $1.9 trillion stimulus programme announced by the new Biden administration to speed recovery from the pandemic. In China, the Government has, in recent weeks announced it will target economic growth of at least 6% over 2021.
More broadly, the Biden administration’s more temperate approach to foreign affairs may help ease trade tensions between the US and China, which unnerved many businesses for much of President Trump’s term in office. This more benign climate is already soothing business’s anxieties. 22% of businesses in the Spring 2021 Trade Barometer say geopolitical uncertainty could have a negative impact on their business, down from 30% in Autumn 2020. Nervousness about the potential for negative impacts from protectionism has also fallen back.
Against this backdrop, the prospects for British businesses on the world stage now look very promising. While many businesses do point to obstacles standing in the way of expansion in key markets, including bureaucracy, the difficulty of finding local partners and questions about how to access new territories, those that get support with these issues are in a strong position to accelerate growth through increased exports. The EU will continue to be an extremely important destination for UK exports, but it is exciting to see UK businesses with ambitions to grow across the globe.
How we can help
We’re as excited about the opportunities in new markets as UK businesses and are here to support you. Our international proposition is not just about providing financial solutions, but rather providing end-to-end trade facilitation across multiple sectors and markets.
From our Trade Barometer findings, we shape our proposition to support businesses looking to start or expand their trade in global markets. Our non-financial solutions include providing insights and practical help from our own sector and country specialists.
Businesses can also leverage our ecosystem of industry and international specialists who offer a range of solutions tailored to meet individual business’s requirements, supporting them to make the most of the international opportunities available. Whether that’s running virtual Trade Missions or our Brexit Compliance Training offering, our aim is to help UK businesses succeed on the global stage.
Here is what one of our customers said about us:
‘It was serendipity meeting Santander in New York after a trade mission fell through. I was welcomed and learnt so much about business in the US that I immediately signed up when I got back. From the trade portal, country specialists and events they’re continually looking for ways to add value and grow our business internationally’.
Helenor Rogers, Owner & Director of Troofoods Ltd (trading as Troo).
Read their story.
Listen to our latest Trade Barometer podcast series on North America and understand why it’s an attractive market for UK business and what challenges may be faced when entering the market. Click here to listen.
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For more information, please read the full Trade Barometer report