[Image courtesy of www.cbi.org.uk]
The CBI and Ernst & Young have published a major new report titled "Winning overseas: boosting business export performance."
According to the report, introducing a credible new exports strategy, which focuses on the right products and services, concentrates efforts on high-growth markets, and breaks down domestic barriers, could give the UK economy a £20 billion lift by 2020.
The report urges the UK Government to set out a clear exports strategy with ambitious, achievable performance targets. The Government should aim to increase net exports from -2.4% in 2010 to 2.5% by 2016, with exports rising from 29% of GDP in 2010 to 36% by 2016. Small and medium-sized companies (SMEs) have some of the most potential to grow so the UK should aim to match the EU average of having one in four SMEs exporting by 2020, compared with only one in five currently.
John Cridland, CBI Director-General, said, "The UK has a proud history as a great trading nation, but in recent years our performance has been lacklustre. Exports success will be one of the key drivers of growth, but for too long we have been over-dependent on advanced economies for our trade.
"The continued crisis in the Eurozone underlines just how important it is for the UK to diversify its export efforts to high-growth countries. Given that we're already playing catch-up with many of our competitors, we must act now or never to target high-growth economies, leapfrog the competition, and deliver our growth potential.
"We need to capitalise on the booming success of the BRIC countries, and look beyond the curve to future high-growth markets such as Indonesia, Mexico, and Turkey. The new middle classes in emerging economies will have needs that our niche, high-end producers are more than able to fill."
Steve Varley, Ernst & Young UK & Ireland Managing Partner, said, "Our inability to break into and succeed in high-growth markets is due to a historic mismatch between the goods and services we currently sell and those demanded by high-growth economies.
"Demand in the last decade from the BRICs has been for manufacturing goods, including machinery, tools and equipment, but in many cases UK companies haven't been strongly positioned enough to compete globally to win this business.
"With the changing demographics in high growth markets, including the rise in the middle classes and consumer spending levels, now is the time for the UK to seize the opportunity to build on its comparative advantage in sectors such as construction services, communication services, electrical goods, optical and high-tech goods, and financial services.
"By tailoring products to specific markets, supported by strong high-quality business intelligence, guiding them every step of the way, businesses can enhance their export performance and boost the UK economy."
The CBI/Ernst & Young report sets out a joint action plan for achieving exports success. It urges the Government to:
• Introduce an 'export enabling test' for all new legislation
• Increase the availability of export credit by diversifying the ways in which firms, especially SMEs can
access ECGD products
• Ensure greater commercial focus in UKTI by introducing 50% business appointments on its board
• Use skills policy to help businesses remain innovative and internationally competitive, by promoting
the study of STEM and language subjects at school
• Resolve the need for more hub and regional airport capacity
• Introduce a single portal www.exports.gov.uk through which businesses can access all government
export services
And commits the CBI to:
• Establish an export finance taskforce to explore ways of removing barriers to finance, reducing risk
and the viability of introducing an export tax credit to incentivise exploratory export activity, which will
report in 2012
• Help develop regional exports clubs to share knowledge and experience
• Celebrate the exports success of its members
• Benchmark the UK's commercial diplomacy offering against our main competitors
• Help shape future trade missions to maximise business outcomes
Please click here to read the full version of the CBI/Ernst & Young report and here to read the summary version.
Please click here to read the full press release by the CBI and Ernst & Young.
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