Government has major opportunity to address Britain's trade deficit
1 December 2016
The Government has a "major opportunity" to address Britain's trade deficit with the establishment of the Department for International Trade (DIT), according to the Business, Energy and Industrial Strategy (BEIS) Committee.
While global growth may partly explain the persistent deficit, it does not explain why UK export growth has been the slowest in the G7 since 2008. The Committee says that companies are being held back by the UK's weak global brand as an exporter, onerous procedure, generic advice and a confusing landscape of support.
The Committee has set out the findings from its inquiry into Exports and the role of UK Trade and Investment, replaced by DIT in July, in a letter from the Chair, Iain Wright MP, to Angus MacNeil MP, Chair of the International Trade Committee, which met for the first time in public on Tuesday (29 November).
Iain Wright MP, Chair of the Business, Energy and Industrial Strategy Committee, said:
"The UK has lagged behind other major economies when it comes to exports for far too long but the establishment of the Department for International Trade provides an excellent opportunity to change this.
The Committee wants to see the Government not only provide clear and accessible support and advice to new and established exporters but also market the UK as an export brand around the world as it.
We hope the International Trade Committee will be able to build on our findings and continue to scrutinise the Government as it looks to overcome the challenges and take advantage of the opportunities arising from Britain's decision to leave the European Union."
BEIS Committee findings include:
- UKTI's previous operating model had significant flaws and required transformational change in order for it to be fully fit for purpose. The establishment of the new Department for International Trade offers a major opportunity to achieve this.
- The UK is good at attracting inward investment but it does not have a strong brand as an exporter. The Government, however, does have high social capital abroad, which can open doors for businesses that may otherwise remain closed.
- UK procedures are more onerous than those enforced elsewhere and could be placing companies here at a disadvantage. A route to get clearer advice on export requirements could benefit businesses.
- Companies highly value face-to-face advice and are concerned that online advice is too generic and high level. The support landscape is also confusing, with national and local government and trade often acting in competition rather than collaboration. The new Department could produce a clear map setting out the support available in one place.
- The Government must address an inherent tension between its headline targets of increasing both the volume and value of UK exports. Supporting more established exporters is likely to drive up the value of UK exports but not necessarily increase the number of exports.
- Business, Energy and Industrial Strategy Committee
- International Trade Committee
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