South West exporters urged to look to new markets as US tariffs start to threaten trade
South West firms exporting to the US have been advised to consider seeking alternative markets in the wake of the introduction of tariffs on goods sold to the US this week.
Business West, the regional business group which runs export services in the region, says there are plenty of free trade opportunities across the globe that can be explored for firms impacted by the blanket 10% US tariff.
Catherine Stephens, Head of International Trade Services at Business West, said: “We understand that traders exporting to the US may be concerned and frustrated by these tariffs, especially given the wider economic pressures they face.
“But there are many more global markets to explore, and UK businesses have more free trade agreements than ever before.”
According to the British Chambers of commerce, (BCC), the new tariffs, including the previously announced 25% duties on steel, aluminium and vehicles, could affect up to £6bn worth of UK-US trade and dampen the UK’s wider economic growth.
Business West, which runs the chambers of commerce in Bristol Bath, Wiltshire and Gloucestershire, admitted that building long-term trade relationships under unpredictable conditions was a major challenge, saying trade wars helped no one and uncertainty around potential UK or EU retaliation would only add to the unease.
It is working with the Department for Business and Trade (DBT), through the BCC, to provide answers to questions that South West businesses may have.
It aims to hold a workshop for members next week, with details still to be confirmed, to provide an opportunity for direct questions to BCC and, it hopes, to the Department of Business and Trade.
But it said despite the anxiety around the US tariffs – which have already disrupted global trade and yesterday wiped £2 trillion off world off global stock markets – there were opportunities, and while businesses couldn’t control global politics, they could control how they responded.
“Now is the time to explore markets that offer more certainty, fewer tariffs and better opportunities for growth,” it added.
It points out that thanks to the UK’s growing number of free trade agreements (FTAs), businesses have more options than ever before.
Most recently, the UK joined the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), opening the door to 11 markets – Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam – with a combined consumer base of more than 500m.
FTAs create significant advantages, including the ability to claim preferential origin – which means goods meet specific criteria proving they originate from the UK.
In turn, this reduces or eliminates tariffs, helping exporters stay competitive and increase their profit margins., Business West said.
It also added that while the 10% tariff on UK goods exported to the US would be challenging, it gives UK firms an immediate 10% pricing advantage over EU competitors.
It was also worth remembering that many customers of products exported from the South West did so on the strength of their brand, quality and reputation rather than purely on price, Business West said.
“As always, the most important thing is to continue communicating with your overseas customers,” it added.
One of our customers, a food ingredients manufacturer, is now successfully exporting to Malaysia under the CPTPP, benefiting from preferential rules of origin.
Business West has been supporting dairy and cheese producers to export to the EU under the EU-UK Trade and Cooperation Agreement (TCA), which allows for zero tariffs on all qualifying goods, and several manufacturers of machinery, pumps, and tools selling in markets with FTAs such as Switzerland, Korea and Jordan.
