With a eurozone crisis still battering the Continent, the prevailing view of foreign markets is that they are a gloomy influence on the British economy.
As the old mantra goes, the UK doesn’t make anything anymore, so instead we borrow on credit cards to run up a massive trade deficit. Now the phenomena of European or global crises can be tacked on to the end of that sorry saga to make it all the more grim.
Except it’s not true. Yes, for many years we have run a large trade deficit. Yes, our manufacturing base is smaller than it once was.
But the numbers show that we are entering a new, reinvigorated era for British exports. Take the traditional manufacturing markets.
Ask anyone what state our car building industry is in, and the traditional answer is that there isn’t one. It was strangled by bad management, misguided government intervention and union militancy – and it will never come back. Millions would give that reply, and yet they would be wrong.
Britain now exports more cars than it imports – the first time we have enjoyed such a healthy balance since 1976. Next year, it is forecast that the north-east of England will make more cars than the whole of Italy, a truly remarkable achievement.
The knock-on effects are sizeable.Despite mechanisation, making more cars still means creating more jobs. Right across the country, new plants are springing up and existing workforces are being expanded.
Two weeks ago, Honda announced an investment of £267m in its Swindon site, creating 500 new jobs in the area. While cars have become increasingly hi-tech in recent years, other technologically advanced industries are making leaps and bounds, too.
An IoD report earlier this year found that the British space industry is now worth £8bn, and supports 60,000 jobs.
At breakneck growth rates of 15pc – something the rest of the economy can only dream of – the sector’s workforce is set to reach 100,000 by 2020.
The same goes for knowledge-based exports. Our universities are a major exporter, for example, attracting many of the world’s brightest minds to pay large sums to study either in Britain or in British-run campuses around the world.
British inventions are also carving out new markets internationally.
Why is it that despite these facts, we still have a negative opinion of our nation’s exporting activity? Part of it is a historical hangover – it will take time to shake off the glum attitudes that developed in previous decades.
But a lot of it is also because the products and expertise we are selling around the world are not all that visible in the day-to-day lives of British consumers. Just look at one small example. Kilfrost is the world’s leading manufacturer of de-icing fluid for the aviation industry.
They make a hugely successful product, and across the globe planes are able to fly safely thanks to their work. They are a major export business, and are breaking new ground with the development of environmentally-friendly de-icers.
They are based in Newcastle, but even people who live around the corner from them may well have never heard of them because what they do isn’t something you advertise on billboards or the TV.
As well as being in an increasingly strong export position, we are also helped by the fact that we are not as dependent on the eurozone as we once were.
Recent research by the CEBR (Centre for Economic and Business Research) shows that for the first time since the early 1970s we are exporting more to non-European Union countries than we are within the EU.
Some of that is due to the contraction of eurozone markets, but it is also down to a 13pc leap year-on-year in sales to the rest of the world. The eurozone crisis is a serious problem, and the sooner Europe recovers the better it will be for Britain.
But it is also good news that we are diversifying away from relying on the EU for the majority of our sales. Increasing the range of markets to which we sell helps to hedge against a regional crisis like that engulfing our near neighbours.
At the same time, we are hitching our economy to the fastest cars in town – Brazil, India and China. In difficult times, these are encouraging signs.
We make a growing range of great products, we are generating ideas that people around the world want to buy and invest in, and we are broadening our international horizons.
All this is happening during the worst sustained economic crisis in living memory. It is an impressive achievement that we haven’t just locked the doors and barred the windows in order to ride out the storm.
Instead, British business has been delivering some real successes. However, every business leader operates on the basis that you can always do more.
That’s partially because such an attitude helps to drive creativity, but also because it tends to be true. No business is ever perfect, and the finished article can never be attained for more than a few micro-seconds in our dynamic, competitive market.
There are simple steps that the Government – and business as a whole – could and should implement to bolster our position still further. The export picture would look even better if we were more accessible and more welcoming to potential customers and investors.
Our airport capacity must be increased, for starters. It is disappointing that the whole question is being delayed yet again by an independent review, when business really needs some swift action and certainty. But even before new runways or hub airports are built, we could improve the economics of air travel.
Britain levies the highest air passenger taxes in the world, which impose a serious burden on the ability of British businesses to fly out around the world, and on the willingness of international visitors to come here.
Amazingly, the level of Air Passenger Duty paid by passengers at Newcastle Airport this year will reach £49m – almost as much as the entire turnover of the airport. This tax is counterproductive, and it should be abolished as soon as possible.
British business would also benefit from a reversal of the technology brain drain. Many of the brightest minds in Silicon Valley are British-born chief technology officers. We should ask why they prefer to create their remarkable inventions in the US rather than at home.
Hopefully the creation of Silicon Roundabout will go some way to setting things right, but a more competitive tax regime would also help. There are many other routes to build a better future for Britain’s export economy.
As I wrote in this column last month – and as the Prime Minister repeated at the time of the Government reshuffle – every Cabinet minister must make the economy their top priority.
We’ve done well without paying this the full attention it deserves, and we could do a whole lot better.
telegraph.co.uk
As the old mantra goes, the UK doesn’t make anything anymore, so instead we borrow on credit cards to run up a massive trade deficit. Now the phenomena of European or global crises can be tacked on to the end of that sorry saga to make it all the more grim.
Except it’s not true. Yes, for many years we have run a large trade deficit. Yes, our manufacturing base is smaller than it once was.
But the numbers show that we are entering a new, reinvigorated era for British exports. Take the traditional manufacturing markets.
Ask anyone what state our car building industry is in, and the traditional answer is that there isn’t one. It was strangled by bad management, misguided government intervention and union militancy – and it will never come back. Millions would give that reply, and yet they would be wrong.
Britain now exports more cars than it imports – the first time we have enjoyed such a healthy balance since 1976. Next year, it is forecast that the north-east of England will make more cars than the whole of Italy, a truly remarkable achievement.
The knock-on effects are sizeable.Despite mechanisation, making more cars still means creating more jobs. Right across the country, new plants are springing up and existing workforces are being expanded.
Two weeks ago, Honda announced an investment of £267m in its Swindon site, creating 500 new jobs in the area. While cars have become increasingly hi-tech in recent years, other technologically advanced industries are making leaps and bounds, too.
An IoD report earlier this year found that the British space industry is now worth £8bn, and supports 60,000 jobs.
At breakneck growth rates of 15pc – something the rest of the economy can only dream of – the sector’s workforce is set to reach 100,000 by 2020.
The same goes for knowledge-based exports. Our universities are a major exporter, for example, attracting many of the world’s brightest minds to pay large sums to study either in Britain or in British-run campuses around the world.
British inventions are also carving out new markets internationally.
Why is it that despite these facts, we still have a negative opinion of our nation’s exporting activity? Part of it is a historical hangover – it will take time to shake off the glum attitudes that developed in previous decades.
But a lot of it is also because the products and expertise we are selling around the world are not all that visible in the day-to-day lives of British consumers. Just look at one small example. Kilfrost is the world’s leading manufacturer of de-icing fluid for the aviation industry.
They make a hugely successful product, and across the globe planes are able to fly safely thanks to their work. They are a major export business, and are breaking new ground with the development of environmentally-friendly de-icers.
They are based in Newcastle, but even people who live around the corner from them may well have never heard of them because what they do isn’t something you advertise on billboards or the TV.
As well as being in an increasingly strong export position, we are also helped by the fact that we are not as dependent on the eurozone as we once were.
Recent research by the CEBR (Centre for Economic and Business Research) shows that for the first time since the early 1970s we are exporting more to non-European Union countries than we are within the EU.
Some of that is due to the contraction of eurozone markets, but it is also down to a 13pc leap year-on-year in sales to the rest of the world. The eurozone crisis is a serious problem, and the sooner Europe recovers the better it will be for Britain.
But it is also good news that we are diversifying away from relying on the EU for the majority of our sales. Increasing the range of markets to which we sell helps to hedge against a regional crisis like that engulfing our near neighbours.
At the same time, we are hitching our economy to the fastest cars in town – Brazil, India and China. In difficult times, these are encouraging signs.
We make a growing range of great products, we are generating ideas that people around the world want to buy and invest in, and we are broadening our international horizons.
All this is happening during the worst sustained economic crisis in living memory. It is an impressive achievement that we haven’t just locked the doors and barred the windows in order to ride out the storm.
Instead, British business has been delivering some real successes. However, every business leader operates on the basis that you can always do more.
That’s partially because such an attitude helps to drive creativity, but also because it tends to be true. No business is ever perfect, and the finished article can never be attained for more than a few micro-seconds in our dynamic, competitive market.
There are simple steps that the Government – and business as a whole – could and should implement to bolster our position still further. The export picture would look even better if we were more accessible and more welcoming to potential customers and investors.
Our airport capacity must be increased, for starters. It is disappointing that the whole question is being delayed yet again by an independent review, when business really needs some swift action and certainty. But even before new runways or hub airports are built, we could improve the economics of air travel.
Britain levies the highest air passenger taxes in the world, which impose a serious burden on the ability of British businesses to fly out around the world, and on the willingness of international visitors to come here.
Amazingly, the level of Air Passenger Duty paid by passengers at Newcastle Airport this year will reach £49m – almost as much as the entire turnover of the airport. This tax is counterproductive, and it should be abolished as soon as possible.
British business would also benefit from a reversal of the technology brain drain. Many of the brightest minds in Silicon Valley are British-born chief technology officers. We should ask why they prefer to create their remarkable inventions in the US rather than at home.
Hopefully the creation of Silicon Roundabout will go some way to setting things right, but a more competitive tax regime would also help. There are many other routes to build a better future for Britain’s export economy.
As I wrote in this column last month – and as the Prime Minister repeated at the time of the Government reshuffle – every Cabinet minister must make the economy their top priority.
We’ve done well without paying this the full attention it deserves, and we could do a whole lot better.
telegraph.co.uk
No comments:
Post a Comment