Member Article

Weak pound can help Cov & Warks SMEs to ride out looming recession, say business leaders

Small and medium-sized firms from across Coventry and Warwickshire are being urged to capitalise on the weakness of the British pound by expanding overseas to help them ride out a looming recession.

William Bain, Head of Trade Policy at the British Chambers of Commerce, was among the speakers at Coventry and Warwickshire Chamber of Commerce’s International Trade Business Summit – just days after the Bank of England raised interest rates to three per cent – the largest jump in 33 years.

This interest rate hike resulted in the British pound falling against the US Dollar once again.

Despite this causing a domestic headache, William is urging businesses to use fresh new trade deals made by the UK government, combined with weakness of the British pound to work with their Chamber to identify and exploit overseas opportunities.

He said: “Despite rising inflation and interest rates that we are seeing domestically, the World Trade Organisation is still expecting to see one per cent growth in global trade next year, which should give businesses great encouragement to start or expand exporting.

“The UK government has also been negotiating bespoke trade details with lucrative overseas markets, including in India, Australia and New Zealand, along with entering an 11-strong trading block of countries – all of which are expected to be finalised in the next year.

“The pleasing aspect around these upcoming trade deals is that business was in the meeting room next door, and have been able to feed into these negotiations to ensure they can help companies to thrive in the longer term.

“Beginning an exporting journey can be a daunting prospect – especially when it comes to picking the right countries to trade with, along with customs documentation and VAT – but the rewards could be the lifeline that sees many firms coming out of the other side of this upcoming recession.”

Phil True from WorldFirst, Giles Lloyd from RationalFX, and David Hooper from Independent Freight also spoke at the summit, which was held at the Ramada Hotel in Coventry.

Phil underlined why there has never been a better time for firms to take a proactive approach to growing their business.

He added: “The weaker the British pound becomes the more appealing our products and services become to overseas customers, so businesses need to look at capitalising on this.

“The ecommerce industry is expected to grow by 50 per cent by 2026, so exploring exporting to countries with developed digital infrastructure is another important factor to consider.”

Corin Crane, the Chief Executive at Coventry and Warwickshire Chamber of Commerce, said events such as the International Trade Business Summit are important for the region’s business community.

Corin said: “Businesses are entering into what could be one of the longest recessions in history, off the back of an already tumultuous period following Brexit and the Covid pandemic, yet despite all of this there are opportunities out there for businesses of all sizes.

“Events such as this are important because they help business owners to take a step back and open their eyes to look at the bigger picture.

“Businesses do not have to wait for the Government to come to their aid or for free trade deals to be signed, and they can, with the help of the Chamber, begin to identify ways in which they can diversify their income and control their own destiny – even in these uncertain times.

“International trade is hugely important in building resilience into individual businesses but also into the wider economy and that is why, through our own international network, we are taking a lead on this and would encourage companies to get in touch.”

This was posted in Bdaily's Members' News section by Matt Joyce .