Welsh companies hope to tap into overseas markets
THE number of Welsh firms trading internationally has risen over the past six months according to Lloyds Bank’s latest Business in Britain report.
The research revealed that around two in five (38%) of the nation’s businesses now export their goods or services, up from 32% six months ago and slightly below the national average of 40%
It comes as Welsh firms experienced a strong end to 2017, with a net balance of 23% stating their international trade had increased in the second half of the year.
Despite this, a net balance of 8% of firms expect overseas sales to fall over the next six months.
Richard Evans, area director for Lloyds Bank Global Transaction Banking in Wales, said: “It’s positive to see that more firms across Wales now consider international trade as an important part of their plans, despite the continued climate of domestic and international uncertainty. Judging from Welsh firms’ export performance over the previous six months, this confidence is not misplaced and by using international trade as a growth strategy for their business Welsh firms can also manage risk during periods of uncertainty.”
The Business in Britain report, now in its 26th year, gathers the views of more than 1,500 UK companies, including 68 in Wales, and tracks a range of performance and confidence measures.
Among Welsh firms, 28% say the biggest barrier to exporting is exchange rate uncertainty followed by tariffs and quotas (cited by 12%) and costs (9%). A net balance of 28% of all Welsh businesses also say the fall in the value of the pound is bad for the economy, with 37% saying it’s also bad for their business.
Based on current overseas trading, the most popular partner countries for Welsh firms are the USA and France, with 46% and 23% respectively exporting to these countries.
Looking ahead, exporters in the region expect the biggest opportunities for international trade to come from the USA (38%), China (27%) and the Far East (8%).
Mr Evans said: “Given the familiarity of UK businesses with the products and culture of the USA, and the fact they are primarily English-speaking, it is understandable that this is a key target for Welsh exporters.
“However, I would encourage exporters not to neglect other countries, as they may be more accessible than they might think and there are numerous sources of help available to manage this process.”