The need to reduce Britain’s trade deficit was at the heart of the David Cameron’s address to the CBI’s annual conference.
At both the opening and the close of his address Mr Cameron said that lobbying organisations, including the CBI but also EEF, The Federation for Small Businesses and others, had consistently urged government not to “divert from the essential task of getting the deficit down.”
Mr Cameron did not shy away from the fact that the UK experienced its worst balance of trade deficit in history this September with a £9.8bn gap between the value of imports and exports and backed the intent behind the CBI-Ernst & Young report released today: Winning overseas: boosting business export performance.
“People don’t want explanations, they want answers,” said Mr Cameron, before promising news in the Autumn Statement next week on a new Credit Easing scheme to “pump billions of pounds into reducing the cost of loans for small and medium sized businesses.”
At a press briefing for the launch the Winning overseas report last week, CBI director general, John Cridland claimed that it was particularly the British medium sized enterprises which now have the potential to create significant growth through exports.
Mr Cridland said however, that the upfront costs of establishing export markets were still daunting for British companies and hinted at plans for a CBI proposal for an export tax credit similar to the R&D tax credit system already in place. It is not yet clear exactly how this credit would be applied. (For more on the Winning overseas report see our story Export strategy: Details of the CBI’s plans to boost exports)
Mr Cameron was clear about his commitment to trumpeting UK PLC overseas saying “I am not interested in ideological arguments about intervention versus laissez faire. I want an industrial strategy that works.”
Despite this however, Mr Cameron failed to touch on certain key sensitive issues such as the impact of the new Bribery Act on the ability of British firms to cope with local business practices and establish local relationships in foreign trade locations.
He also failed to touch on the dichotomy between UK corporation tax – now the most competitive in the G7 – and UK energy legislation and tax. It was this aspect of the business environment in the UK which last week caused mineral extraction and processing giant Rio Tinto Alcan to announce the closure of its Lynemouth plant with the loss of around 600 jobs.
Overall delegates welcomed the Prime Minister’s participation though David Bell, a speaker on the morning discussion panel and chief corporate development officer at JCB commented: “We hear lots of talk about a long term manufacturing industrial strategy but I don’t see it very much in reality.”
The UK’s leading business lobbying organisation held its annual conference in London today at the Grosvenor House Hotel on Park Lane.
The conference theme focused on exports as the key to economic recovery for the UK and the Prime Minister visited the conference to deliver a keynote presentation before the midday break.
Commenting on the Prime Minister’s participation at the CBI annual conference, the third time Mr Cameron has spoken there, Mr Cridland said: “He recognised the need to refocus UK exports towards emerging markets, echoing the CBI and Ernst & Young’s research.”
The CBI conference continues this afternoon with presentations from Turkish President, Abdullah Gϋl and Secretary of State for Foreign and Commonwealth Affairs, William Hague.
The Manufacturer is collecting comment on the CBI report ‘Winning overseas’. To have your say email comment to: firstname.lastname@example.org.