Exporting is, and will continue to be, crucial for the UK economy. As Lord Green, Minister of State for Trade and Investment, said in his keynote speech at Reform's conference on "Open for Business" this week, exporting is "the most important preoccupation of this, or any, Government." As we near the end of the Government's Export Week, it is time to reflect on the success of the Government export agenda. In 2012, the Chancellor set the ambitious target of doubling the value of UK exports to £1trillion by 2020. On current trends, we will fall a long way short.
New research by the think tank Reform shows that UK businesses have huge export potential, ranking particularly highly on levels of innovation. We have much to be proud of. The UK is still the 6th largest exporter in the world, and with the emergence of a global middle class, there will be ever greater demand for our products and services. So why are we not on track to reach these targets?
Current Government provision for exporters is complex and hard to navigate, with sources of support and advice split across nine government departments. Awareness is also low, with only 13% of SMEs aware of the support available from UKTI. New survey data for Reform's report shows that Government is one of the last places that businesses look for support, instead choosing to go to their banks, business bodies and accountants. In the last year, 50% of SMEs went to their accountants for help, whereas only 12% sought information and advice from Government agencies.
Government is right in its aims to support British business; they have just failed to use the right levers to do so. To make a real impact on the UK exporting landscape, the Government will need a renewed focus on improving the overall business environment. Reform's research found that the UK ranks relatively poorly on openness to trade, cost to export and trade- and transport-related infrastructure. Minimising the logistical and bureaucratic barriers between businesses and their customers overseas could help to build a business environment where firms have the confidence to fulfil their export potential.
Gaining access to markets is also a major barrier for exporters. As global trade patterns continue to shift, the role of the Foreign and Commonwealth in commercial diplomacy and will be increasingly important. The experience of Singapore, which ranks exceptionally highly on its openness to trade, highlights the value of establishing Free Trade Agreements with major trading partners in both developed and newly emerging economies.
The Government's export targets are unquestionably ambitious. However, they are also incredibly important. In order to be achieved, there must be shared ambition and a co-ordinated effort across business bodies, banks and Government. Yet while Government support is needed to oil the wheels and open the doors, and the private sector is a crucial source of support and advice, it is then down to businesses themselves to export and expand overseas.