UK Looks East for Business Growth
According to a report by Ernst & Young, UK businesses have been looking overseas for new income streams after taking advice from government and industry bodies.
In its report titled Competing for Growth, Ernst & Young sought the views of 1400 business leaders from around the world as to from where its future growth will come from.
The report says that UK companies will be looking East and focusing their attention in that geographical area in the next 2 years. This will buck the new global trend for companies to move back into developed markets.
The study has found that UK top company executives believe that in the next 2 years, only 48% of their company’s growth will be coming from Western Europe. This can be compared with 64% that happened in the downturn.
The report also says that UK company bosses think that 15% of their company’s growth will be coming from the US and Canada. This is down from 24% previously.
The report showed that China has been attributed as a key source of growth at 29%, which is significantly up from 11% 2 years ago. 16% of the respondents favoured India as a centre of growth. This is up from 9% 2 years ago.
Steve Varley, who is Ernst & Young’s Markets Leader for UK & Ireland, said that the most recent statistics from the ONS show that exports from the UK to India and China combined (£11.8 billion) are worth only half of UK’s total exports to Ireland (£23.8 billion). He also said that this demonstrates that there are huge opportunities for UK businesses in those markets.
Varley further added: “We’re encouraged that company bosses are responding to calls from UK government and industry bodies, like the CBI, to progress those opportunities to fuel growth in the post-crisis economy.”