Trade gap narrows as 2012 ends due to £769m export increase

Ben Southwood
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THE UK’S trade deficit narrowed from £3.6bn in November to £3.2bn in December, according to data out yesterday.

The overall narrowing was driven by a £769m – 1.9 per cent – jump in exports, the Office for National Statistics (ONS) said, outweighing a £393m bump to imports.

But this end of year improvement could not outweigh a year of broad export contraction. Exports were £120.7bn in the fourth quarter in total, 1.5 per cent down on the £122.5bn sold in the third quarter.

Similarly, exports were down around £6bn to £487.1bn through the whole of 2012, the ONS data showed, in comparison to the £493bn shifted in 2011.

The longer-term picture was equally downbeat. Exports have grown at 4.8 per cent per year between 2002 and 2012, the ONS said, while even excluding oil, imports have grown at around 5.1 per cent over that period.

Still, firms are optimistic that the current improvement can translate into a steadier upward movement, according to separate data from DHL and the British Chambers of Commerce.

Optimism over exporters’ future turnover and profitability is at a two-year high, DHL and the BCC said regarding their survey of 1,500 companies.

“It’s encouraging to see Britain’s exports continue to grow thanks to the ambition and talent of UK businesses, despite the continued challenges they face,” said BCC director general John Longworth. “This optimism is a true reflection of the businesses I visit week in, week out, across the UK.”