The Trade and Investment Minister, Lord Green, urged South West businesses to look to exports for long term growth yesterday as it emerged the number engaged in international trade has remained static for the past five years.
Speaking to the Western Morning News ahead of his keynote speech at the Marine City Festival Business Expo Event on Plymouth Hoe, Lord Green said the region was behind the national average for exports and must look to the online world to remove the "obstacles" of our geographic position.
The former chairman of HSBC said he was working with banks to improve lending policies that many SMEs claim are hindering their ability to move into lucrative foreign markets.
Official statistics show the South West exported £3.1 billion of goods and services in the first quarter of this year – up £72 million on the same period in 2011 – and exports grew nearly nine per cent to £12.5 billion in the year to the end of March 2012.
However, although the region has 9.4 per cent of UK businesses it accounts for only 7.6 per cent of UK exports. The number of South West businesses engaged in international trade has remained static for the last five years, at 2.9 per cent.
Lord Green said: "I don't know enough about the South West in business terms to say why it is behind the national average, what I do know is that there's an opportunity here, particularly in the online world.
"Trading online has removed the need to be physically close to your market...the world opens up on your doorstep. I don't want to be naive about it and I do understand that if you're only a small business and have never done it before it is quite a daunting prospect to look overseas. But that way lies growth, that way lies the ability to create new jobs, and also that way lies fun. What company after company find is that it is exhilarating."
Asked whether transport issues including the loss of Plymouth's airport could be proving a barrier to Westcountry firms' export aspirations, he said: "There are some real facts of geography and the proposition is not going to be exactly the same as other parts of the country, but the South West has some things to offer that the South East does not. You've got to look at what you have and make the best of that.
"There are distinctive characteristics of the region that can be showcased very effectively for foreign investors."
Lord Green said currently 60 per cent of exports from the South West go to the EU, higher than the national average of around 50 per cent. He added: "That's not necessarily a good or bad thing, but the big growth markets are further afield." He pointed to the need to tap into opportunities in Asia, Eastern Europe, the Baltic States and Latin America.
The Minister said that as well as driving growth, there was "strong evidence" that joining the export market leads to increased efficiency, with businesses on average reporting a 30 per cent improvement within the first couple of years. During his time in Plymouth, Lord Green visited Kawasaki and Princess Yachts, also dining with members of the city's Growth Acceleration and Investment Network (GAIN).
He praised the initiative, saying it was a "shining example" of what is needed around the country.