Foreign Secretary William Hague’s call on British firms to “get on the plane” was rewarded with signs of life from exporters today, but efforts to cut the UK’s trade gap remain hampered by European turmoil.
Hague — who launched an attack on business leaders at the weekend for complaining instead of “getting on with the task” — will have noted a 6% rise in the UK’s overall exports in March, outstripping more modest 2.4% growth in imports.
But the overall goods trade gap remains unchanged at £8.6 billion, frustrating hopes for a rebalancing of the economy. A big rise in sales of cars and pharmaceuticals to countries such as China and the US pushed non-EU exports to a record £13.2 billion, but this was offset by stagnant exports to Europe and an £800 million jump in imports from the Continent, mostly down to oil.
IHS Global Insight economist Howard Archer warned of subdued demand from Europe, the UK’s biggest export market. “Of particular concern to UK exporters is likely very weak overall economic activity in the eurozone for some time to come,” he said. “Furthermore, events in Greece are currently heightening the downside risk to the eurozone economic outlook.”
