For the past two years businesses have had to operate despite not knowing where the Brexit debate will take the country.
During this time many businesses have continued to flourish and develop. Confidence has remained fairly high and there has even been significant growth in the number of business start-ups. This has all helped unemployment to fall to levels last seen in the 1970s and the number of people in work rise to an astonishing 75.7%
However, despite all of this positivity, coupled with historically low interest rates, the pound falling in value by 15% and growing demand in large parts of the world, export growth has remained sluggish at best.
Brexiteer bravado would maintain that once free of the EU, British companies will be able to aggressively enter new markets, belying the fact that Britain has neither the will or the effective organisation to make this happen. Britain has been poor at exporting goods and services with the exception of financial services for many years. Unlike many other EU countries who have given greater priority to exporting, the United kingdom does not have collective business organisations to help companies enter foreign markets. British Governments have created Development Agencies, Business Links and other bodies wholly accountable to Government. Many have done their best to undermine private sector initiatives and organisations. For instance, unlike elsewhere in Europe, Chambers of Commerce in Britain have struggled to maximise their effectiveness.
Government initiatives to promote trade and export have taken the form of establishing public sector agencies heavily marketing driven. Who can forget Trade Partners and their use of “Buzzy Bees” or UK Trade and Investment heavily draped in the Union Jack. The latest iteration, Department of International Trade – DIT lead by Dr Fox, Minister of State for International Trade, has been just as ineffective. Failure consistently comes from civil servants not being entrepreneurial and customers being unable to differentiate between government support initiatives and government as the guardians and promoter of control and regulation.
For Britain to boost export performance it needs to incentivise companies to export. The best way of doing this is to encourage companies to collaborate and bring banks, consultants and market experts together to collectively assist aspiring exporters. In this way Britain can learn from the expertise of other European countries who have established private sector organisations in foreign markets. The most effective of these are the German Chambers of Commerce in individual markets linked back to the very powerful and well resourced Chambers in Germany. They have ensured that German companies are assisted with collective effort to help with design, marketing, finance, supply chain, logistics, service and overall customer satisfaction. Lord Green was the last British International Trade Minister to recognise this and he started the initiative to organise overseas British Chambers.
Unfortunately, his efforts were undermined by civil servants intent on protecting their fiefdom and gradually squeezing out the businesses they were supposed to help.
For Britain to survive either in the EU, or in a post Brexit world, it is essential that business starts to look more positively at exporting and comes together to set up or build on, where they exist, effective networks to provide mutual help. Specialist companies like International Trade Matters Ltd working with Chambers of Commerce and other collective business organisations can make a big difference. They can ensure that information is disseminated and be a catalyst for action.
What is your company doing about international trade in a global economy?
If it is waiting to see whatever emerges from Brexit, it will have a very long wait. In the meantime it will be missing major opportunities.
George Cowcher is Economic Development & Strategic Trade Specialist at International Trade Matters Ltd
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