Liam Fox MP will be announcing a financial support package for SMEs today (5th June).
The Secretary of State for International Trade is speaking at an event celebrating 100 years of UK Export Finance’s (UKEF) backing for international trade.
It’s the first time such an extensive financing package has been made available to small businesses who export to fast-growing emerging markets from the UK.
What will be in the package?
The new financial support package will include:
- The Small Deal Initiative – to back exporters undertaking smaller contracts that underpin British trade
- Extending financial support to firms in exporters’ supply chains as well as exporters themselves
- The General Export Facility – covers general costs for exporters, rather than just costs related to a specific export deal
The Small Deals Initiative will see UKEF guaranteeing the loans of potential overseas buyers of British goods to make UK bids more competitive.
The General Facility also allows UKEF to support exporters’ overall working capital requirements, as opposed to needing support to be linked to the needs of a specific export.
This flexible approach will give smaller business greater access to bonds and working capital.
British businesses play an important role in global supply chain. The latest data shows that nearly a quarter of exports in 2015 were embedded in the exports of other countries.
However, Dr Fox will also warn that the world must prepare for a period of upheaval as the global economy is predicted to slow down. He’ll argue that the work the Department for International Trade is doing through UKEF will help strengthen British exporters.
The state of UK exporting
Confidence in the UK’s willingness to export increased in 2018 – 5pc of SMEs who aren’t currently exporting plan to export in future, up from 3pc in 2017. The latest statistics from the ONS show UK firms sold more overseas in 2018/19 financial year, £639.9 billion, than at any other time since records began.
That said, around 400,000 businesses in the UK can export but don’t.
Looking into international trade?
Exporting as a small business: A guide to exporting goods abroad