Brexit uncertainty, tariffs and exchange rate volatility are continuing to hold back the UK’s exporters, according to a new survey conducted by Bibby Financial Services (BFS) and the British Chambers of Commerce (BCC).
1,140 internationally active UK businesses were polled and uncertainty around Brexit was considered the top barrier to export by 47% of businesses, followed closely by specific concerns around tariffs (35%) and exchange rate volatility (33%).
Administrative requirements or regulation and a lack of free trade agreements, both of which could be connected to Brexit, also scored highly at 30% and 23%. Only 7% said they are not facing significant barriers to exportin.
Businesses are also facing issues in relation to stockpiling, payments and the transportation of goods. Over the past 12 months:
- around a third (31%) of businesses reported that they had increased the volume of inventory held;
- 15% reported that it already takes longer to transport goods to and/or from overseas, even before the UK’s exit from the European Union; and
- and almost a third (29%) reported that it takes longer to get paid by customers.
The uncertainty around Brexit is also affecting businesses who are currently operating solely within the UK but who could be exporting, with 31% saying Brexit is their top barrier to exporting. Only 7% of these domestic businesses are expecting to start exporting or importing within the next 3 years, with only 17% saying they are not facing any barriers to international trade at present.
Edward Winterton, UK Chief Executive, Bibby Financial Services, added:
“Chronic uncertainty resulting from Brexit is undoubtedly stifling international trade amongst UK SMEs. Importers and exporters are in limbo, and many are postponing investment decisions, while they await further information. Many others are focusing resources on ensuring they’re prepared to deal with the potential impacts of a no-deal scenario.
“SMEs are telling us that they need clarity over the detail, and it’s imperative that the Government looks to provide this as soon as possible to enable businesses to trade with confidence, both domestically and internationally.”