By Tim Reid, below, CEO, UK Export Finance
We’ve been no stranger to volatility in recent years. From navigating the impacts of the pandemic, to the rippling effects of the war in Ukraine, the last few years haven’t been easy. Not least for UK SMEs.
In my 35 years working in banking and trade finance, I’ve seen first-hand the many hurdles facing businesses on their journey to ‘going global’. I have also seen the huge wins that can come with exporting. Time and time again UK SMEs have proven their resilience despite obstacles at home and abroad.
In uncertain economic times, it can be tempting to rely on the domestic market. The idea of exporting in 2023 may seem challenging, but SMEs shouldn’t be discouraged. At UKEF, over 80% of the companies we support are small and medium-sized firms. This strong track record shows that we stand ready to partner with UK businesses, especially SMEs, to help them achieve their exporting ambitions.
Triumphs in trying times
We’ve worked with some of the best and brightest British SMEs who refuse to let economic uncertainty impact their growth ambitions. When the impacts of the global pandemic were being felt by UK businesses, many took advantage of our Export Insurance Policy (EXIP). By offering insurance that can cover up to 95% of the value of an export contract, this product helps companies who have either lost cover or cannot access private export insurance with confidence. This support was particularly relevant for SMEs in the wake of the pandemic with backing provided across sectors, including retail, creative marketing and recruitment.
And, as the UK marched ahead on its post-Covid recovery, last year we supported Devon-based Eco Charger to export the world’s first all-electric quad bikes to America, and Somerset’s Wyke Farms, who now export their sustainably-produced cheese to over 160 countries. The support enabled Eco Charger to double its workforce, creating highly skilled environmentally friendly jobs across the UK. Wyke Farms has seized the opportunity to push further into markets all over the world.
These success stories show that there’s so much to be gained by taking the global leap. After all, SMEs are the lifeblood of the UK economy and sustaining their success is critical in securing a high-growth future for the UK.
Connecting SMEs with opportunities around the world
Alongside bespoke export finance for UK businesses, UKEF activates the UK supply chain, connecting overseas project sponsors and buyers with UK exporters, through government-backed financing. We estimate that at least 10,000 UK firms win or retain business indirectly through the supply chain thanks to UKEF, the majority of these being SMEs.
Making this possible are UKEF’s International Export Finance Executives (IEFEs) who are based all over the world and help to galvanise new opportunities for UK businesses, from North America to North Africa, South-East Asia to the Middle East.
For example, in January we announced £130m in support for the construction of a new specialist burns hospital in Kilamba, Angola. The terms of the deal between UKEF and the Angolan Ministry of Finance mean that 40% of the project will be fulfilled by UK suppliers – totalling over £50m in potential export opportunities for domestic businesses.
Our mission is to ensure no viable UK export fails for lack of finance or insurance, doing so sustainably and at no net cost to the taxpayer. Working alongside The Department for Business and Trade, UKEF will continue to provide support for small businesses, helping the backbone of the UK economy stay ahead and export British brilliance.
Eyes on the prize
Those with strong ambitions and a resilient business behind them should know that growth opportunities remain very much there for the taking. UKEF’s IEFEs located around the world, as well as our on-the-ground regionally based team of Export Finance Managers in the UK, are on hand to help businesses on their exporting journey every step of the way.
SMEs should remember that global opportunities are still on the cards, despite current headwinds, and it may just be the strategy needed to boost growth in the years ahead. Success story after success story proves there’s no reason for UK SMEs to stop thinking globally.