Exports still promising
Aug 08 2011
Orders and confidence among exporters remain robust
UK exporters are showing continued signs of strength year on year as export sales grew by 3.6 per cent on the same quarter in 2010.
The promising figures from the DHL/BCC Trade Confidence Index, which draws on a survey of more than 1,000 exporters, suggests that orders and confidence among exporters remain robust.
The balance of exporters that believe their turnover and profitability would improve over the next 12 months improved in Q2 2011, with firms’ confidence in increasing turnover rising from +41 per cent to +46 per cent, and their confidence in increasing profitability up from +17 per cent to +28 per cent.
David Frost, director general of the British Chamber of Commerce says, ‘The UK’s economic recovery relies on exporting and investment. Government must help British business to have the confidence to export and invest – and ensure that support schemes designed to help new and growing exporters are easy to access and easy to understand.’
However, continued uncertainty around the resolution of the Eurozone debt crisis, and the fragility of the UK’s economic recovery means British exporters are reticent to invest and take on more staff.
Exporters’ intentions to invest in plant and machinery have recovered slightly since the recession, but they still remain weak by long-term standards, with a balance of +9 per cent looking to invest.
Exporting firms’ plans to take on more staff in the next quarter are anaemic, with manufacturing at +4 per cent and services +13 per cent.
Frost adds, ‘There is a disconnect between the strong performance of exporting firms and their lack of confidence when it comes to investing and creating jobs. An uncertain economic outlook, with concerns surrounding Eurozone debt and a fragile UK recovery, means many businesses are holding back on investment decisions - despite seeing strong export sales and orders in recent months.
‘Cashflow is still a real problem for exporters, particularly smaller firms, and the results show that there are regions of the UK that lag behind when it comes to exporting outside the EU.’
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