East Midlands firms shunning export markets due to Brexit uncertainty
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Less than half of exporters in the East Midlands expect their sales to increase over the next six months, according to new research.
In its latest Business in Britain report, Lloyds Bank said a net balance of 35% of firms in the region were expecting to see an uplift.
This is on the back of a strong end to 2017, in which a net balance of 26% of firms say their international trade had increased in the second half of the year.
More than a third (36%) of the region’s businesses currently export their goods or services – below the national average of 40% but the same as six months ago.
Sadly for advocates of international trade, 40% of East Midlands exporters are turning their back on overseas sales, opting to focus instead on growing UK business.
Uncertainty over the post-Brexit climate has put many people off from dipping their toes in export markets.
Tim Hanley, East Midlands area director for Global Transaction Banking, SME at Lloyds Bank Commercial Banking, said: “The majority of East Midlands exporters still see international trade playing an important role in their plans, despite the continued climate of domestic and international uncertainty.
“Judging from East Midlands firms’ export performances over the previous six months, this confidence is not misplaced and by using international trade as a growth strategy for their business British firms can also manage risk during periods of uncertainty.”
The Business in Britain report, now in its 26th year, gathers the views of more than 1,500 UK companies, including 120 in the East Midlands, and tracks a range of performance and confidence measures.
Among East Midlands firms as a whole, almost a quarter (24%) say the biggest barrier to exporting is exchange rate uncertainty, followed by difficulty finding potential customers (cited by 13%) and language barriers (8%).
A net balance of 16% of all businesses across the East Midlands say the fall in the value of the pound is bad for the economy, while 25% conclude it’s bad for their business.