The UK is set to continue its specialisation as a producer of financial, digital and business services, according to new research.
Santander UK has published a report with Public First on views of the UK as a trading partner, providing a detailed analysis of key growth markets and options for a future export approach.
A third (33%) of polled business leaders felt that the UK was a world leader in financial services, whilst 26% said the same about technology and digital services, and one in five (21%) about business services and management consultancy.
The research, conducted amongst 2,100 business leaders and decision-makers, found that financial and business services constituted an average of 55.9% of UK service exports since 2016, and 27.3% of all exports in the same period. Moreover, based on Public First modelling, business and digital services have seen significant growth in exports, with the potential to almost triple in export value by 2033.
The UK ranked top when business leaders were asked which countries they would consider for business consultancy and business services, with more than 40% of those operating in professional services agreeing and over 36% across the full sample of participants. When business leaders were asked which countries they would consider for providing software and technology the UK came top within professional services and second across the whole sample.
Evidence suggests traditional manufacturing in service-based economies including the UK is undergoing a productive revolution. Digitally intensive service sectors already add value to UK manufacturing equivalent to over a quarter of total output (25.8%) by enabling additional trade and generating a need
for sophisticated technological outputs.
Additionally, the report projects global trade in the environmental sector will concurrently see transformative levels of growth in the next ten years. According to the Public First data, there is 8.2% projected growth in global green exports, this is growing considerably faster compared to growth in global services exports (5.4%) and global goods exports (4.9%), with G7 economies that will partake in a significant portion of this expansion in exports.
John Carroll, Head of International and Transactional Banking at Santander UK, said:
“It is reassuring to know many key markets across the world view the UK as positive trading partner when it comes to exports. For UK businesses the possibilities for growth over the next decade are endless, particularly in digital and business services sectors which we are known for. UK manufacturers are incorporating technology to modernise the industry, and the results show this is paying off.
“It is also welcomed that sectors supporting the environmental transition continues to grow, showing the UK at the forefront for green exports. We are delighted that business leaders globally have praised the UK for its high quality and reliable products and services, and we hope UK businesses continue to thrive overseas with our support.”
Gareth Thomas MP, Minister for Services, Small Business and Exports, said:
“This new report is a blueprint of opportunity to help us unlock the barriers to trade for UK companies. We can’t do this in isolation. It’s essential we work with businesses, like Santander, to enable more SMEs to export internationally. The UK is a proud trading nation, our goods and services are in high demand overseas and we’re working hard on developing our export strategy to support this.”
Damayanti Chatterjee, Senior Economist, Public First, said:
“The new UK Government’s commitment to growth-led prosperity means that getting international trade and exports right is more important than ever. Our new report shows that the UK is in a strong position to do that, with sustained growth in professional services, opportunities to transform manufacturing in the digital age, and a strong reputation abroad for reliability and quality on which to build. A three-way partnership between businesses, government, and the wider private sector that supports British SMEs in their continued recovery after the pandemic and a period of high inflation is key to unlocking the full potential of British exports over the next decade.”