• UK goods and services trade deficit remains at £4.5bn in July

Commenting on the trade deficit for July published today by the ONS, David Kern, Chief Economist at the British Chambers of Commerce (BCC), said:


“These figures were slightly disappointing as most analysts expected a modest narrowing in the trade deficit. While exports have increased in July, imports have risen even faster, making it clear that the much-needed rebalancing of the UK economy towards net exports is not happening quickly enough.


“The growing problems facing the global economy, particularly the eurozone, presents UK exporters with major challenges. With the austerity measures in full swing, it is clear that net exports will have to be the main engine of Britain’s economic recovery. With this in mind, it is time for the government to back a national export drive. Unless we accelerate the pace at which exports increase, it will be difficult to sustain UK growth.

“The government must focus on backing small- and medium-sized firms in key areas such as trade finance, insurance and promotion. While a competitive exchange rate and low interest rates will help UK exporters, additional efforts are needed to ensure that UK businesses can compete on equitable terms with overseas businesses.”