Analysis highlights importance of EU market to exporting manufacturers

Seven of the UK’s top export destinations are within the European Union, and trade within the bloc is worth more than twice that of the United States, according to analysis from Make UK and Santander.

The analysis ‘UK Manufacturing: 2019/20 The Facts’, shows the United States is the single biggest export market for UK manufactured goods and services, worth £118.2 billion, and exports to the top seven EU markets alone amounted to £236.5 billion in the same period - £256.1 billion including Switzerland.

The findings show that manufacturing accounts for two thirds of overall R&D, 45% of exports, 15% of business investment and 2.7 million high value jobs which are better paid than the economic average. With annual output of £192 billion the UK remains the ninth largest manufacturing nation in the world. 

By region the North West is the biggest single by output, worth £28.5 billion, closely followed by London and the South East worth £28.1 billion. 

Paul Brooks, UK head of manufacturing, Santander, said: “The UK has always punched well above its weight when it comes to exports and it’s vital this trend continues – jobs across the UK count on it. 

“While we are helping businesses build strong trade links with partners around the world, the message from manufacturers is clear: Europe must remain a strong trade ally. We’ll continue to support the UK to hold its position as a major global economy and exporter.”

Seamus Nevin, chief economist at Make UK, added: “These figures lay bare the overwhelming importance for manufacturers of trade with our closest market and the need to avoid imposing any barriers which will make this more difficult.

“Whilst the United States remains the biggest market and, presents significant opportunities for export growth, it is a fallacy to believe that geography is not the biggest factor driving trade. For UK manufacturers access to their biggest market must be a premium."

The UK is due to leave the bloc on 31 October, with prime minister Boris Johnson pledging not to Brexit any further – even if it means leaving without a deal despite Parliamentary legislation which would compel him to ask for an extension.  

Proposals outlined by Johnson last week brought about some concern from Make UK about the effect they will have on manufacturing, in particular in Northern Ireland.

Stephen Phipson, CEO of Make UK, said: “Make UK has made it clear from the start that no deal will decimate Britain’s manufacturing companies. The Prime Minister’s proposals do create complexity and friction for Northern Ireland on both the north/south and the east/west borders, leaving NI manufacturing in the worst possible place.

“Time is running out and we urge the EU and the UK Government to protect the 2.7million jobs our sector delivers across the whole of the UK and the billions of pounds of exports they generate.”