Tips on trading opportunities in the eurozone
With latest reports highlighting that business confidence in the Eurozone is on the increase as the services sector reverses its decline, the Institute of Export’s Director General Lesley Batchelor responds to a sample of frequently asked questions on harnessing opportunities – and reminds us that the UK is still one of Europe’s biggest buyers.
Which countries of Northern Europe offer most opportunities to Yorkshire businesses in which sectors, and why?
Germany is still very strong but unfortunately they are savers rather than spenders – and we need all markets to keep spending. If they see a good product they will buy it – which presents companies dealing in international trade with a great opportunity to be innovative and come up with new products.
To regain a trade balance we should actively market to France – a country from which we currently import more than we export – whereas some emerging markets require more skills and technology offerings. Northern Europe as a region has also been identified as an ideal target market for the UK’s food and drink producers.
Whatever the opportunities, it’s important that companies the length and breadth of the UK thoroughly research and understand new markets and cultures – along with all the factors that may impact on price and who they are going to sell to.
How do you advise businesses to proceed considering the current economic situation?
We advise businesses to start planning, move out of their comfort zones and adopt the ‘think global act local’ formula which has worked well for HSBC. Conduct due diligence by researching before investing in new markets such as China or Brazil with their wealth of potential, as opposed to relying on trial and error.
What is your view of the ‘crisis’ in the Eurozone and its potential impact on UK/Yorkshire business – do you feel it is over-hyped, or a very serious issue?
The Eurozone crisis is over-hyped and not because it isn’t a problem. It does pose an enormous concern, but we shouldn’t forget our past history with European countries. We need to make a more concerted effort to broaden our activities and thus mitigate risks in international trade. Both UK Export Finance and BIS (the Department for Business, Innovation and Skills) have devised schemes to help capitalise businesses, insure against risk and provide guidance. Companies worried about these issues should talk to organisations like us because there are always solutions to their problems.
While we continue to talk about exporters, it’s important to remember that we are one of Europe’s largest buyers. The difference between what France sells to us and what we buy from France is disproportionate, and we need to seek out ways to support British products or to help our producers to sell into those markets. The UK is likewise an important market to France. It may transpire that we need to change some of our habits if we’re going to stop participating in the EU. Ultimately we are all in this together and, whatever the outcome, I very much doubt that we will terminate trading with Europe which is so important to support our growth and prosperity.
What questions would you like answering regarding the ongoing Eurozone issue? Post them below and we’ll respond to them.
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