• Sun. Jun 16th, 2024

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North East Businesses Say EU Trading Still Vitally Important

North East businesses want to maintain a close trading relationship with their key European customers and suppliers, according to the results of the British Chambers of Commerce’s (BCC) International Trade Survey.

The results of the national business survey, which included North East businesspeople’s views showed that North East business see the future trading relationship with the EU as a high priority. Three-quarters of North East respondents sell and source  goods and services in the EU market.

The results show that over a third (35%) of North East businesses are planning to put additional resources into exporting to the European market over the next 5 years, reflecting the national survey results figure. However, although 11% are looking to source more from Europe, nearly a tenth (9%) are looking to reduce the number of products and/or services they import from Europe, possibly due to the effect of the increased prices due to the fall of the pound sterling.

Ben Powick, policy adviser, North East England Chamber of Commerce said: “North East businesses continue to see the EU as integral to their export plans. Although the government has outlined some of their key Brexit priorities, the future trading arrangements with the EU remain unclear. Despite this, North East companies continue to see Europe as key, with well over a third looking to put additional resources into the market.

“In terms of our trading future relationship with the EU, tariffs are the top priority, with North East business prioritising tariffs, expensive non-tariff barriers and public procurement regulations to be at the top of the agenda for our future EU trade deal.

“Positively, North East businesses are looking to expand their global presence, with well over 20% of respondents indicating they were planning to put more resources into markets such as North America, Australasia and China. The export support provided by the Department for International Trade is essential to this.”

Howard Ions, managing director of Chamber member Salem Tube: “As a region, I do not think the long term future of GB manufacturing gives us anything to worry about.  Sterling is a double edged sword for businesses at present.  Its weakness means companies in the UK have a new price advantage, due to the fact their labour cost drops against the Euro, but costs for their raw materials from the EU increase.  My belief is that if a company produces a good product, reliably on time, at a competitive rate, and stays on its toes,  it will always get through, no matter what.”

In 2015, 58% of North East exports went to the EU, therefore there appears to be continued confidence in the EU market.

Internationally, over a quarter of North East businesses are looking to put more resources into exporting to North America. Similarly, 23% are looking to put more resources into Australasia, 22% to China and 21% to the rest of Asia (excluding India).

Regarding the future trading arrangements with the EU, North East business consider tariffs, non-tariff taxation, and public procurement regulations as the three top priorities for resolution in a Brexit deal. Interestingly, regarding our future relationship with non-EU markets, the top three priorities for negotiation were work permits and visas, public procurement regulations and non-tariff taxation.

There has been a lot of interest recently, particularly in the North East regarding the potential of Free Trade Zones at ports and airports. When asked about whether they felt it would have an impact on their business, a significant number (29%) felt that it would have a positive impact on their business.