Policy

Increasing the UK’s exports and attracting inward investment

Issue

Inward investment into the UK economy created or secured more than 112,000 jobs in 2011 to 12.

The government wants to help double the UK’s exports to £1 trillion by 2020 and attract more inward investment in UK infrastructure projects.

We are determined to remain one of the top countries for ease of doing business, by providing more support for British businesses to export their goods and services, and reducing corporation tax to competitive levels.

Actions

UK Export Finance supports exports through its range of products and services. These include guarantees to banks for loans used to purchase UK exports and insurance against non-payment. Its remit is to complement and not compete with the export insurance and finance available from the private sector.

In 2011 UK Export Finance broadened its business domain and product range to provide support for exports sold on short terms of payment. It offers a Bond Support Scheme and an Export Working Capital Scheme and, to help smaller exporters access the right support, it operates a network of regional Export Finance Advisers.

UK Trade & Investment (UKTI) offers several services to businesses looking to export from or invest in the UK.

International Trade Advisers are able to provide professional advice on a range of UKTI services, including financial subsidies, export documentation, contacts in overseas markets, overseas visits, e-commerce, export training and market research. They are located in over 40 local offices around the country. Every UK region also has dedicated sector specialists who can provide support tailored to specific industries.

The Overseas Market Introduction Service (OMIS) is a flexible business tool that lets you use the services of UKTI’s trade teams, located in embassies, high commissions and consulates across the world, to benefit your business.

UKTI’s Passport to Export is an assessment and skills-based programme that gives new and inexperienced exporters the training, planning and ongoing support needed to succeed overseas. Passport to Export also helps companies to research, visit and select markets. For more information, contact your local International Trade Team.

The Tradeshow Access Programme (TAP) provides grant support to help enable businesses to take part in overseas trade exhibitions, acquiring market knowledge and experience as part of a strategic approach to exporting. TAP also provides support to help enhance the UK group presence as a whole at these events.

The Gateway to Global Growth is a UKTI service aimed at experienced exporters. It offers a 12- month programme of strategic support tailored to your needs to help grow your company’s business overseas.

The UKTI’s Export Communications Review gives companies impartial advice on language and cultural issues to improve their competitiveness in export markets.

British businesses can carry out export marketing research on all the major aspects of any export venture using UKTI’s Export Marketing Research Scheme.

UKTI established the UK Advisory Network in 2007 to provide high-quality and trusted support to investors setting up in the UK through closer working between the government and the private sector. The network makes access to private sector expertise easier and more effective and allows those experts to share knowledge and market information.

The government is simplifying and reducing corporation tax to encourage inward investment. The reduction to the rate of 24% means that the UK now has the lowest main rate in the G7 and the fifth lowest in the G20. We plan to reduce the rate to 21% from April 2014, making it the fourth lowest in the G20.

The Foreign and Commonwealth Office is establishing a new government-owned company, the British Intergovernment Services Authority (BISA), to help the UK benefit from government to government contracts with other countries.

BISA has been specifically set up to manage these contracts and help facilitate and deliver opportunities for British companies across the entire supply chain, from major prime contractors to SMEs. It is not yet trading but in 2014 it is expected to grow into a fully operational company, with its own chief executive and board. For more information contact Jolyon Welsh, Head of Government to Government Contracting, FCO, by email at jolyon.welsh@fco.gov.uk

Background

The FCO’s Business Charter, published in 2011, shows how Foreign & Commonwealth Office (FCO) resources can meet the needs of British business. It is part of the FCO’s work to create lasting prosperity for the UK, explaining the specific contribution that the FCO makes to support business across the world.

UKTI has an ongoing programme of research that looks into the effect of exporting on UK companies across the economy.

Bringing home the benefits: how to grow through exporting found that for many UK companies the decision to grow through exporting has been profitable. Those companies who venture into new export markets tend to be rewarded both directly through boosted turnover, and indirectly through improved levels of efficiency, innovation and credibility

New markets, new ideas: How exporting fosters innovation and growth suggests that many British companies are embracing a new era of internationalisation. This can be seen in both an increasing number of companies doing business overseas and the rising number of firms that export from an early stage.

The report also investigates the benefits business experience as a result of exporting including increased levels of growth, productivity and innovation. More young companies are grabbing international opportunities from an early stage; almost one in five (17%) new companies currently active abroad are classified as ‘Born Global’ - so have been doing business overseas since the outset.

Many internationalised firms experience a ‘virtuous circle’ where exporting led to innovation, and where those innovations then led to further exporting. Over half of all firms (53%) said that a new product or service evolved because of their business overseas.

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