Sterling volatility major concern for exporters, says BCC/DHL Quarterly Survey
3 September 2018
Many exporters are performing well but economic and political factors are weighing on them, according to the latest British Chambers of Commerce (BCC) survey in partnership with DHL.
While confidence remains strong, wider economic and political factors are having a dampening effect, according to the survey of more than 2,600 manufacturing and services exporters.
Key findings include that 39 per cent of exporting manufacturers saw an increase in orders in the last three months as did 30 per cent of services exporters.
A total of 60 per cent of manufacturing exporters are more concerned about exchange rates than three months ago, a four per cent rise from the previous quarter. Meanwhile, 26 per cent of manufacturing exporters and 25 per cent of services exporters are more concerned about inflation.
Other findings include that 35 per cent of exporting manufacturers and 32 per cent of services exporters expect their prices to rise. Of manufacturing exporters under pressure to raise prices, 81 per cent blame rising imported raw materials costs.
The survey adds that 77 per cent of exporting manufacturers and 67 per cent of services firms tried to recruit in the last three months but 69 per cent and 60 per cent respectively reported difficulties finding the right staff.
The BCC/DHL Trade Confidence Index, a measure of the volume of trade documentation issued nationally, fell by 1.34 per cent. It now stands at 125.26, the fifth highest level since records started in 2004.
The outlook indicates that many UK exporters are maintaining their competitiveness in foreign markets with healthy sales and order books but the weak pound is increasing raw materials costs.
With growing tension around any future UK-EU trading relationship and over trade with the US, the survey says that government must maintain business confidence and improve the domestic business environment.
BCC director general, Dr Adam Marshall, says: “The UK government can’t control currency or the actions of trading partners but it can mitigate uncertainty at home.
“Reaching a pragmatic, business-focused Brexit deal with the EU would go a long way to reassure markets and business communities. Addressing issues in the domestic environment – most importantly the UK skills shortage – should also top the agenda when parliament returns next week.”
Follow Chamber International on Twitter @ChamberInt and on Facebook for the latest in international trade.
