The Scotsman

Exports fail to get motoring as trade deficit mushrooms

● Bosses say fall in pound is ‘doubleedge­d sword’ ● Latest official data also reveals a fall in constructi­on

- By SCOTT REID

Business leaders yesterday branded Britain’s trade position as “underwhelm­ing” after it emerged that the nation’s deficit in goods and services had widened further.

While sterling’s slump since last June’s Brexit vote has put consumers under pressure, it had been hoped that the pound’s weakness would provide a significan­t boost to UK exports by making British goods cheaper for overseas buyers.

However, official data yesterday revealed that the UK’S deficit in goods and services – the gap between exports and imports – widened by £2 billion to £4.6bn between May and June after a slump in exported goods. For the second quarter as a whole, the deficit rose £100 million to £8.9bn.

Suren Thiru, head of economics at the British Chambers of Commerce, said: “The sharp deteriorat­ion in the UK’S net trade position in June was disappoint­ing, and means the trade deficit in the second quarter of this year came in slightly higher than in the previous quarter.

“Businesses continue to report that the slump in the value of sterling since the EU referendum remains something of a double-edged sword, as many exporters are also importers, and so face higher input costs due to the weakening currency.

“While stronger global economic growth may help to boost the UK’S export performanc­e over the second half of the year, it is unlikely to be sufficient to prevent an overall weakening in growth.”

Meanwhile, separate figures from the Office for National Statistics (ONS) showed that a pick-up in industrial output in June had been marred by a slump in car production and a fall in constructi­on.

According to the latest data, industrial output nudged up 0.5 per cent in June month-onmonth, largely down to North Sea oil producers delaying their usual summer maintenanc­e.

Year-on-year, production was up 0.3 per cent in June following a decline in May. However, transport equipment manufactur­ing, including car production, fell 3.6 per cent.

Constructi­on output dipped 0.1 per cent, contractin­g for the third consecutiv­e month, and fell 1.3 per cent in the second quarter.

Jack Coy, an economist at the Centre for Economics and Business Research (CEBR), the economics consultanc­y, said: “Today’s manufactur­ing figures are disappoint­ing, given high measures of optimism currently being posted in the sector.” Heroes of all ages will be able to use the latest advances in laser gaming to enhance their powers in a new superhero laser tag arena, thought to be the first of its kind in the UK. Wee Heroes is opening in Falkirk’s Callendar Square, providing people with an opportunit­y to use state-ofthe-art technology imported from America. Creator Craig Macdonald, 19, has used advice from Business Gateway Falkirk to get started and transform the former retail unit in just two months.

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