Have UK goods exporters been losing their touch?
By contrast, UK exports to many other markets over the same years have grown rapidly, suggesting that UK exporters are not to blame
There has been a decline in the growth rate of UK exports during the Single Market. According to one explanation, UK exporters have not been smart or nimble enough to profit from the opportunities it offered.
When a comprehensive analysis of all the other factors that might influence UK export performance is available, this will no doubt be considered a possible explanation. However, until that research is undertaken, it is interesting to compare the growth rate of UK exports to Single Market members with exports to non-member countries.
The 33 fastest-growing markets for UK goods exports over 19 years of the single market are listed in the table. It shows that UK exports to 25 non-member countries have grown at a faster rate than those to the 11 other founding members of the single market. These results were not seriously affected by the financial crisis. If we stop the clock in 2008, and calculate the growth of UK exports only to that date, the EU only moves up two places. Growth of exports to the single market was slow throughout its 16 pre-crisis years.
Of course, the value of exports to the EU11 far exceeds the value of exports to single non-member countries. Some of the EU11 were among the highest value markets for UK exports. This is in no way remarkable since every nation trades more with their neighbours than with more distant countries. The USA’s biggest export markets are Canada and Mexico, not China and Japan.
The promise of EU membership was growth in trade, and that promise was fulfilled as we saw in the common market decades. It has not been fulfilled under the single market.
This data also throws some doubt on the claim that UK exporters have not been smart or nimble enough to take advantage of the opportunities presented by the single market. They must have been quite smart and nimble in some of these other extra-EU markets, where they have not enjoyed the advantage of ‘sitting around the table helping to make the rules.’ These figures also suggest that this advantage has been much over-rated.