Lord Ian Livingston
Crispin Simon, Chief Executive, UKTI
David Godfrey, Chief Executive, UK Export Finance
Chaired by Margot James MP
Margot opened the event by welcoming everyone to the panel discussion and thanking them for their support over the last year. This was the last Trade & Investment APPG event of the year and Margot was delighted that so many supporters, business leaders, MPs and advisory board members attended. She then proceeded to introduce Lord Livingston, who was coming to the end of his first week in his role as Trade Minister, Crispin Simon of UK Trade and Investment, and David Godfrey of UK Export Finance.
Lord Livingston then proceeded to outline some of the conclusions he had come to over the last few months shadowing his new role. He noted that:
- There was good will and enthusiasm both within Government and the population to help Britain export.
- The country is doing well in supporting large companies, especially in the defence and aerospace sectors.
- However, we need to improve with SMEs. He noted the importance of separating the ‘Ms’ from the ‘Ss’, as the needs of small companies can vary significantly from medium sized ones.
- Trade missions should be better in recognising what areas those countries need more exports in and then tailoring the companies invited to those needs.
Lord Livingston stated that the biggest barrier to UK exporters was a lack of awareness for the support available. Although a huge percentage of people who deal with UKTI and UKEF have a good experience, there is a low awareness of their services. He asserted that there should not be a single medium sized company who is not exporting because they don’t know where to get help from.
Lord Livingston also stressed that there is a lot of focus on BRIC, but that we shouldn’t forget the already developed countries and the opportunities that they present. The UK has just signed a trade deal with Canada and Lord Livingston asserted that we need to send a trade mission there. America also remains the UK’s largest export market.
Margot thanked Lord Livingston for his insights and proceeded to introduce Crispin Simon, who is standing in as Chief Executive of UKTI following Nick Baird’s recent departure. Crispin began by outlining some of UKTI’s policy strategy:
- An important focus on making government procurement more accessible for SMEs.
- The FCO’s Emerging Powers Strategy acknowledges that growth is beginning to come from more difficult markets and disproportionate assistance is now being given to companies wanting to export to these countries. Examples include: China, India, Brazil, Mexico, Indonesia, South Korea and Colombia.
- New programmes have been launched such as the Business Ambassador programme and the Trade Envoy programme.
Crispin acknowledged that despite the challenges, UKTI are hoping to contribute significantly to the 2020 aim to double exports to £1 trillion. The main challenge here is finding 100,000 more exporters (from 2011-2020). He discussed some of the ways they are doing this:
- Assistance is given to companies hoping to export through ‘export vouchers’ (with a value of up to £3,000) which can be spent on trips overseas and marketing consultation.
- UKTI is getting behind webinars – many businesses are often time short, not money short, and so cannot make the trips down to London due to time constraints.
- More money is being put into the GREAT campaign and awareness is slowly rising.
- The Overseas Business Initiative provides greater support to champions of commerce overseas and will allow UKTI to focus on high-value opportunities while the business bodies provide day-to-day business services.
Crispin concluded his talk by reinforcing that the country needs to double exports by 2020 to £1trillion, which requires an annual growth rate of 8%. Something UKTI are determined to work towards.
There was then a time for attendees to pose questions to the panel. In his answers Lord Livingston pointed out that in the level of cut backs the government has had to undertake, the government has shown a commitment to trade. Following a question from a business owner who had recently won an export contract in China’s Chongqing, Lord Livingston acknowledged the importance of sending trade missions to more varied destinations. He also stressed the need to use MPs as a marketing arm more effectively when it comes to exporting.
There was also a concern over the lack of awareness of UKTI and whether or not trade targets would be reached. Ian and Crispin both said that they believe that the GREAT campaign was becoming increasingly successful since its launch over 2 years ago. The GREAT campaign is a branding campaign and, following on from the Olympics, has been helping to change the perception of Britain.
David Godfrey, who recently took up his position as Chief Executive of UK Export Finance was the final speaker. He began by highlighting recent support from the Treasury through two announcements in the budget:
- The aggregate limit was doubled from £25 to £50 billion.
- The limit available for capital market allowance has been increased.
David asserted that UKEF was focusing on trade, finance and insurance business and was planning on doubling the number of Export Finance Advisors in the UK from 12 to 24. Their role is to guide medium exporters towards where they can get the best support and they have been extremely successful at this so far.
UKEF’s main strategies are focused on export insurance, shared risk and education. David set out UKEF’s commitment to publishing useful marketing material; this is a new move for the organisation. He acknowledged that some of their documentation had been too long and clunky and that this issue was being addressed and their new material was shorter and had a quicker turnaround time. He noted that awareness of the support available from UKEF was too low and that in order to combat this they are targeting 20,000 companies with assistance.
In response to a comment that the finance and attitude of banks disadvantages SMEs, David highlighted the importance of segmentation. He argued that companies vary hugely by sector and that a company that may only employ a few staff members may be a big exporter so should be treated as a larger company. Although many representatives of banks stressed their commitment to helping SMEs there was still some concern that business owners were not being helped enough by their banks. David acknowledged that providing bonds is not strategically appealing for banks, as they take on a high risk capacity; however if UKEF can take on up to 80% of that risk banks should be able to help.
Margot then concluded the discussion, thanking everyone for attending the final APPG event of the year. Lord Livingston expressed his appreciation for the support he has had so far in his role and hoped people would come to him with their views and spread the word about UKTI and UKEF.