DCMS Sectors Economic Estimates 2020: Trade headline release

Question 1

1. Headline findings

Accepted Answer

Released: March 2022

This release provides estimates for the following measures for 2020:

estimates of exports and imports of goods in DCMS Sectors ^{[footnote 1]}
estimates of exports and imports of services by businesses in DCMS Sectors ^{[footnote 2]}
exports and imports of tourism where exports are defined as spending on goods and services by overseas visitors to the UK and imports are defined as spending by UK visitors overseas.

Estimates of trade in services and trade in goods are not comparable on any basis as they use different data sources and different definitions as to what constitutes an import or an export.

Readers should note that unlike previous years, there are no breakdowns of trade in tourism by world regions or individual countries. We have presented only the headline figures for trade in tourism as published by the Office for National Statistics. This is due to the underlying data source, the International Passenger Survey being suspended from 16 March 2020 to January 2021 as a result of the pandemic.

1.1 Trade in Goods

Trade in DCMS Sector goods in 2020 (current prices) is estimated as:

£48.6 billion of goods imports, 9.8% of total UK goods imports
£22.1 billion of goods exports, 7.1% of total UK goods exports

Imports of DCMS sector goods have been consistently higher than exports between 2015 and 2020 (the years of which data are available). This is consistent with the wider UK economy (the UK is a net importer of goods^{[footnote 3]}).

Of the years for which data are available (2015 to 2020), 2020 was the first year in which the value of DCMS sector goods traded in current prices was substantially lower than in the previous year. For imports, this is in line with a UK-wide decrease in the value (in current prices) of goods imports between 2019 and 2020. DCMS sector goods exports saw a proportionally much larger decrease between 2019 and 2020 in value compared to the UK economy as a whole.

The proportion of total UK trade in goods accounted for by goods in DCMS sectors has decreased between 2015 and 2020 for both imports (11.4% to 9.8%) and exports (9.2% to 7.1%) (Figure 1).

Figure 1: Trade in DCMS Sector (excl. Tourism and Civil Society) goods, as a percentage of the UK total: 2015 to 2020

1.2 Trade in services

Trade in services by businesses in DCMS Sectors in 2020 (current prices) is estimated as:

£40.4 billion of service imports, 25.3% of total UK service imports
£67.2 billion of service exports, 23.0% of total UK service exports

Exports of services by businesses in DCMS sectors have consistently been higher than imports of services between 2015 and 2020 (Figure 2). This is consistent with the wider UK economy (the UK is a net exporter of services ^{[footnote 4]}).

The value of DCMS sector services traded in current prices increased year on year between 2015 and 2020. In contrast, the value of services traded by the UK (in current prices) increased year on year between 2015 and 2019 but fell in 2020.

2020 was the first year (of those for which data are available) that trade by DCMS sector businesses accounted for a larger proportion of UK total service imports than of UK total service exports. This was because UK service imports fell faster than service exports between 2019 and 2020.

The proportion of total UK trade in service accounted for by businesses in DCMS sectors has increased between 2015 and 2020 for both imports (15.0% to 25.3%) and exports (16.9% to 23.0%).

Figure 2: Trade in DCMS Sector (excl. Tourism and Civil Society) services, as a percentage of the UK total: 2015 to 2020

1.3 Trade in Tourism

Tourism imports:

In 2020, Tourism imports (spend on goods and services by UK visitors overseas) was £13.8 billion (current prices), down from £62.3 billion in 2019.

Tourism exports:

In 2020, Tourism exports (spend on goods and services by overseas visitors to the UK) was £6.2 billion (current prices), down from £28.4 billion in 2019.

The data source for estimates of trade in Tourism, the International Passenger Survey, was suspended from 16 March 2020 to January 2021 as a result of the pandemic. There are therefore no breakdowns available by world regions or individual countries, and no additional reporting of trade in tourism estimates in this report.

Question 2

2. Introduction

Accepted Answer

The DCMS Sectors covered in this release are:

Creative Industries
Cultural Sector
Digital sector
Gambling (services only)
Sport
Telecoms (services only)
Tourism (covered on a separate basis to the other sectors)

Estimates of trade in services and trade in goods are based on different data sources and are derived using different definitions as to what constitutes an import or an export. They are two separate statistics and cannot be added together or directly compared on any basis (sector or individual country). See data sources section for more information.

This release includes figures up to and including 2020, i.e. these estimates are affected by EU-Exit and the COVID-19 pandemic. Caution is advised when making year on year comparisons of trade in goods or services due to the combined effects of the national and international lockdown restrictions as a result of the pandemic, EU-Exit uncertainty and border disruptions which contributed to the volatility in UK goods and services trade ^{[footnote 5]}. See Annex A for a timeline of events and pieces of legislation that occurred between 2015 and 2020 relevant to the movements of goods and people. 2015 is the earliest year for which data is available that allows for reasonable comparison at country level with 2020 data.

Estimates are given in current prices and have not been adjusted for inflation. Year on year increases are therefore likely to be higher than the ‘real’ (inflation-adjusted) value. Changes over time are therefore reported here as changes in the proportion of total UK imports and exports.

Unscheduled revisions have been made to the 2019 exports of goods data as a result of corrections applied to the Overseas Trade in Goods statistics 2015 to 2019 by HMRC. Pre-2019 trade in goods data remain unchanged. Further information on these corrections can be found on the UK Trade Info website.

Question 3

3. Trade in Goods

Accepted Answer

Estimates of trade in goods are calculated on a “cross-border” measure of trade; a good is recorded as an export or import when it physically leaves or enters the economic territory of a country. Due to the different definitions and calculations, estimates of trade in goods are not comparable on any basis to the estimates of trade in services. See Data Sources section for further information.

3.1 Trade by DCMS Sectors

In 2020, the value of goods imported by DCMS Sectors exceeded the value of goods exported by £26.5 billion. This was predominantly due to the Digital sector (Figure 3), particularly imports of goods in the ‘Manufacturing of electronics and computers’ sub-sector. DCMS Sectors are not mutually exclusive; industries may contribute to and be classified as more than one sector. For more information, see the DCMS Sector overlaps in Annex B.

FIGURE 3: The net balance of trade* in goods by DCMS Sector, current prices, 2020, UK (£ billions)

DCMS Sectors	-26.5
Digital Sector	-26.6
Creative Industries	1.1
Culture Sector	0.2
Sport Sector	-0.2

*A negative net trade balance indicates that the value of goods imported is higher than the value of goods exported.

The value of goods traded by each DCMS Sector is presented below, in current prices.

Creative Industries

In 2020, trade in Creative Industry goods was estimated as:

£7.8 billion goods imports (1.6% of UK goods imports, down from 2.1% in 2019).
£8.9 billion goods exports (2.9% of UK goods exports, down from 3.8% in 2019)

Culture Sector

In 2020, trade in Cultural Sector goods was estimated as:

£6.5 billion goods imports (1.3% of UK goods imports, down from 1.8% in 2019).
£6.6 billion goods exports (2.1% of UK goods exports, down from 3.1% in 2019),

Digital Sector

In 2020, trade in Digital Sector goods was estimated as:

£41.4 billion goods imports (8.3% of UK goods imports, up from 7.9% in 2019)
£14.8 billion goods exports (4.8% of UK goods exports, unchanged from 2019)

Sport Sector

In 2020, trade in Sport Sector goods was estimated as:

£1.4 billion goods imports (0.3% of UK goods imports, up from 0.2% in 2019).
£1.2 billion goods exports (0.4% of UK goods exports, down from 0.6% in 2019),

3.2 Trade with European Union (EU) and non-EU countries

This section summarises the trends in DCMS Sector goods trade with the EU and non-EU countries. The EU is a large market for the UK, ^{[footnote 6]} ^{[footnote 7]} ; trade with the EU accounted for 46.7% of total UK goods imports and 47.9% of total UK goods exports in 2020. Imports of goods

Imports of goods

Less than half of DCMS sector goods were imported from EU countries between 2015 and 2020 (Figure 4). Imports of DCMS sector goods from EU countries decreased as a proportion of total trade between 2015 (44.1%) and 2020 (39.2%). The proportion of DCMS sector goods imported from non-EU countries has increased accordingly over the same time period (2015: 55.9%, 2020: 60.8%).

Total UK goods imports from EU countries also decreased as a proportion of total goods imports between 2015 (54.6%) and 2020 (47.5%). The proportion of UK goods imports from non-EU countries has increased accordingly over the same time period (2015: 45.4%, 2020: 52.5%).

FIGURE 4: The proportion of total goods imports from EU countries by DCMS Sectors and the UK, 2015 to 2020.

Exports of goods

Less than half of DCMS sector goods were exported to EU countries between 2015 and 2020 (Figure 5). Exports of DCMS sector goods to EU countries have increased as a proportion of total trade between 2015 (36.9%) and 2020 (48.7%), with a small decrease in 2017. The proportion of DCMS sector goods exported to non-EU countries has decreased accordingly over the same time period (2015: 63.1%, 2020: 51.3%).

Total UK goods exports to EU countries increased as a proportion of UK total goods trade between 2015 (44.6%) and 2020 (47.8%). The proportion of goods exported to non-EU countries by the UK has fallen accordingly between 2015 (55.4%) and 2020 (52.2%).

FIGURE 5: The proportion of total goods exports to EU countries by DCMS Sectors and the UK, 2015 to 2020.

3.3 Trade with individual countries

This section summarises trade in DCMS sector goods by partner country in 2020 (Figure 6).

Imports of goods

China (£15.1 billion) was the largest source for DCMS sector goods imports to the UK in 2020, followed by the Netherlands (£7.0 billion).
In contrast, Germany (£57.1 billion) was the largest source for goods imports across the wider UK economy, followed by China (£53.4 billion) ^{[footnote 2]}
For all of the top five partner countries the Digital Sector was the largest category of DCMS sector goods imports.

Exports of goods

The USA (£3.7 billion) was the largest market for DCMS sector goods exports in 2020, followed by Ireland (£2.3 billion).
The USA (£44.7 billion) was also the largest export partner country for goods across the wider UK economy, followed by Germany (£32.6 billion) ^{[footnote 2]}
For the USA and Switzerland, Creative Industries was the largest category of DCMS sector goods exports. The Digital Sector was the largest category of DCMS Sector goods exports for Ireland, Germany and France.

FIGURE 6: the top 5 countries that the UK’s DCMS Sector businesses imported the most goods from and exported the most goods to in 2020

Question 4

4. Trade in Services

Accepted Answer

Estimates of trade in services are classified by the business involved in the trade and not the service provided. They are calculated on a change of ownership (balance of payments) measure of trade - if trade moves across land borders but remains under the same ownership this is not counted as trade. Estimates of trade in services are not comparable on any basis to the estimates of trade in goods. See data sources section for further information.

4.1 Trade by businesses in DCMS Sectors

This section summarises the trade in services by businesses in DCMS Sectors in 2020 by individual sector.

In 2020, the value of services exported by businesses in DCMS sectors exceeded the value of services imported by £26.8 billion, predominantly due to businesses in the Digital Sector and the Creative Industries (Figure 7). Exports of services in both sectors are driven by businesses in the ‘Computer programming, consultancy and related activities’, and the ‘IT software and Computer Services’. DCMS sectors are not mutually exclusive; industries may contribute to and be classified as more than one sector. See DCMS Sector overlaps in Annex B.

FIGURE 7: The net balance of trade* in services by businesses in each DCMS Sector, current prices, 2020, UK (£ billions)

DCMS Sectors	26.8
Digital Sector	21.4
Creative Industries	17.8
Cultural Sector	4.2
Sport Sector	2.3
Telecoms Sector	1.6
Gambling Sector	-0.1

*A positive net trade balance indicates that the value of services exported is higher than the value of services imported.

The value of services traded by businesses in each DCMS Sector is presented below in current prices.