Belfast Telegraph

UK trade gap widens as exports slump £8bn in a year

By Holly Williams

Britain's trade gap last year grew to its highest level since 2010 - £125bn - as the UK saw an £8.1bn plunge in the export of goods.

The Office for National Statistics (ONS) said the deficit - the difference in value between UK imports and exports - widened by £300m to £34.7bn in 2015.

This came despite an improvement in December, with the deficit reducing to £2.7bn from a revised £4bn in November.

But the narrowed trade gap showed little sign of a much-needed pick-up in exports, with the gap easing thanks only to a fall in imports.

Experts said the Government's target for £1trn worth of overseas sales by 2020 would be a "monumental challenge", while business groups warned "much more needs to be done" to boost exports.

The ONS also confirmed that trade proved a drag on overall UK growth in the fourth quarter of last year and throughout 2015.

UK firms struggled to sell products abroad last year as the strong pound made British goods more expensive, while the global economic woes and slowdown in China added to the trade troubles.

The figures show exports of goods to the European Union fell by £11.6bn between 2014 and 2015, as the weak euro made UK products more expensive.

Exports to China have fallen since 2011 and there are fears the sharp slowdown in China's economy will further hit the UK over the year ahead.

Allie Renison, head of trade policy at the Institute of Directors, said the rise in the deficit last year was "unsurprising given the sharp fall in the price of oil, which knocked British exports and made imports a little cheaper for British customers".

"Meeting the Government's ambitious target of £1trn worth of overseas sales by 2020 will be a monumental challenge," she added.

David Kern, chief economist at the British Chambers of Commerce, said: "Much more needs to be done to improve our trading position, with particular emphasis on helping small businesses to start exporting, as well as helping firms to break into new export markets."

Belfast Telegraph