Sunday, July 21, 2024

Small firms need Government to reduce cost of international trade

Small firms say the “supply chain could crumble” unless the next Government prioritises international trade.

Figures from the Federation of Small Businesses (FSB) show that one in five (22%) small firms are worried about the costs of exports and imports over the next five years.

The research also shows how one in four (27%) would like to see a reduction in the cost and time it takes to import and export.

Elsewhere, three in ten (28%) say that one of the measures in FSB’s manifesto proposal for a Small Business Act should focus on making it easier for the UK to trade internationally.

Tina McKenzie, FSB’s Policy Chair, said: “International trade fuels progress and fresh ideas, and without it, our supply chain crumbles. Small firms who reach global markets also tend to grow faster and be stronger during tough economic times.

“However, our research presents some troubling figures, so the next Government will therefore need to keep trade at the top of their agenda.

“Strengthening trade links with major markets like the EU and USA is key to the UK’s future as a global trading force. This would also incentivise small firms to start and continue trading.

“Our election manifesto outlines ways to achieve this, including creating a simple online trade portal that collects all the information small firms need to provide just once – a “once and done” approach. The hefty paperwork and confusing fees associated with international trade are also a concern, and those administrative burdens need to be reduced.

“Investing in training for Border Force staff is a quick way to keep goods moving smoothly across the borders, as will on-the-ground resources to improve customs training.

“There also needs to be plans for a next-generation export development grant or tax relief scheme, taking inspiration from successful international examples, such as the ones used in Australia for decades.

“In the 2026 review of the UK/EU Trade and Cooperation Agreement, the Government should negotiate to remove the need for an intermediary for the EU VAT system. They should also aim for mutual recognition of product standards and professional qualifications in key sectors.

“We were pleased to be invited to work with the Labour Party on an exports taskforce, which will create a better approach to industrial trade and policy, and be published shortly.

“Simplifying international trade for small businesses will allow us to drive significant economic growth and increase resilience. We must not let this opportunity pass us by.”

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