Business leaders yesterday called for renewed efforts to boost exports after a strong pound and weak overseas demand saw Britain’s trade deficit balloon in July.
Official figures revealed that the export of goods fell by £2.3 billion to £22.8bn in July, the lowest figure since September 2010, led by a drop in exports of chemicals and manufactured goods.
This meant that the goods trade deficit widened to £11.1bn from £8.5bn the month before, worse than economists had expected, while the overall goods and services deficit grew to £3.4bn, four times its level in June.
The British Chambers of Commerce described the figures as “disappointing” and said the worsening picture highlighted the political need to address the UK’s export performance.
David Kern, the business body’s chief economist, said: “Although one month’s worth of figures cannot be taken in isolation, they are a reminder that we are still a long way from rebalancing our economy.
“Although non-EU exports continue to rise on an annual basis, it is concerning that the latest figures show that exports to non-EU countries fell more sharply than exports to the EU. This may be a reflection of the increased problems that many emerging countries are now experiencing.
“Overall, it is clear that we need a national strategy to boost exports, so that we can tackle our stubborn trade deficit.”
Separate figures showed that the manufacturing sector suffer its largest monthly fall in activity for more than a year, against expectations for a modest rise.
The double whammy came ahead of a speech today by the CBI director-general, John Cridland.
He was due to tell an audience of business leaders, economists, government officials and politicians, gathered in London: “We now need to do in more emerging markets what we are already doing in China – and double our exports… The last decade of exports may have belonged to Germany, but the next decade can be ours.”