Our trade deficit – the difference between how much we export and how much we import – shrank to £2.7bn in March, compared with £2.9bn in February, according to the Office for National Statistics. There has been more uplift in services than manufacturing: the deficit on trade in goods was £8.6bn, whereas trade in services enjoyed surplus of £5.8bn. The services surplus was £200m more than February.
Manufacturing makes up approximately 10% of the UK’s GDP, meaning a trade in goods deficit is felt more keenly by industry than a deficit in services would be. Making their contribution to get that deficit down further, three companies have this week revealed plans to branch out into overseas markets.
Payday loans company Wonga.com this week launches its consumer loans service in South Africa, in a move that takes it overseas for the first time. Future plans include moving into Canada and Ireland once some traction has been gained in the South African market. The company is also about to expand its product line at home in the UK with the introduction of loans of up to £10,000 for businesses. Whilst the company has attracted a lot of criticism for its high interest rates, its growth and popularity is undeniable: it has served more than £1bn of loans since it was founded in 2008.
In energy, Highland-based offshore engineering outfit Global Energy Group has announced plans to establish a base near Bergen in Norway. Currently, more than half of the firm’s workforce is based in Scotland, totalling around 2,150 workers. The company is acquisitive, having purchased a fabrication yard on the Cromarty Firth last October, and this expansion of its North Sea operations will help it cement its position. In Norway, its operations will include supporting a range of work including gas plants, drilling platforms and carbon capture.
Finally, British clothing design label Paul Smith is having a second crack at the Chinese market, in which it plans to open 24 stores over the next five years, including a headline store in Shanghai that will feature around 5,000 sq ft of retail space. The firm had abandoned its Eastern adventure in 2007 after its operation there made undisclosed losses, but now Sir Paul Smith is hoping to replicate the enormous success he has enjoyed in Japan, where he is seen as a super-star of tailoring.
All in all, a string of much needed good news for UK commerce. The trade deficit is narrowing (albeit gradually) and companies in a diverse range of sectors are having a crack at new markets. Here’s hoping they reap rewards and give a boost to UK plc…