UK tech isn’t getting post-Brexit export deals because of a lack of government funding
Posted 15 February 2017 | 0 Comments
- The government’s Tradeshow Access Programme is supposed to pay around £10 million for small businesses to go to overseas tradeshows and begin exporting.
- The UK government is four months late with the funding.
- Trade organisations are now unable to take new exporters to shows like MWC Shanghai because it’s too expensive.
UK tech companies are missing out on millions of pounds worth of export deals because they aren’t getting the funding to attend international trade shows.
The government is more than four months late in allocating up to £10 million in grants to small companies in every sector from fashion to pickles to life sciences, to help them go to industry tradeshows and begin exporting, according to affected trade organisations speaking to Business Insider.
The money is supposed to be handed out by the Department of International Trade and distributed through trade organisations.
Labour’s shadow business minister, Bill Esterson, has been monitoring the delays. Speaking to Business Insider, his staff say the government was due to announce which companies had successfully received grants for the year starting April 1 in September last year.
It’s now February, with no sign of an announcement, and trade organisations have had to cancel their presences at key shows around the world because it’s too expensive to attend without grants.
The UK’s technology trade association, Tech UK, outsources its export business to Tradefair, which takes small companies to events like MWC Shanghai and MWC Barcelona and houses them in a dedicated UK pavilion.
Tradefair’s financial director Bridget King told Business Insider that the funding is so late that there won’t be a UK pavilion at MWC Shanghai.
“It’s unlikely to go ahead,” she said. “We took five exhibitors last year and between them, they have at least 15 business wins from the show and 70 new leads. There was an estimate from one company that they made $2 million [£1.6 million] in revenue.”
MWC Shanghai takes place in June, and tradeshow planning needs to happen almost a year in advance, King said. That means it’s “too late” to take a British group to the show.
The government will usually provide up to £2,500 per company travelling to an overseas show. The presence of a branded UK pavilion means companies also have visible government backing, ad hoc support, and hospitality areas, lending them credibility to foreign buyers, King said. Companies can also receive several grants, allowing them to enter multiple markets.
While there’s nothing stopping a company attending a tradeshow off their own steam, King said several Tradefair members were “not prepared to commit” without the additional funding.
Tim Collins, director for lab technology at automation trade association Gambica, said funding for tradeshow access had declined.
“For the year ending March 2017, it was £9 million, and it was about £16 million two years ago,” he said. “It seems very strange – if we’re going to have to go and export more to other countries outside the EU, then you would want to put more effort into this sort of support.”
Other industries directly effected include energy, with new exporters unable to attend an Iranian oil and gas summit, and brewing, with the BFBI’s members missing out on the Craft Brewers Conference in the US.
The Department of International Trade has not responded to a request for comment and has given no guidance on when it will announce funding.
Bill Esterson, shadow business minister, said the delays damaged the UK’s standing after the EU referendum vote.
“The abject failure of the Conservative Secretary of State for International Trade means we will lose trade deals in Iran; we will lose deals in China; we will lose deals in the US in April. This will potentially cost the UK tens of millions of pounds in exports and the government must announce the allocations as a matter of urgency.
The one thing the Department for International Trade needs to do is secure the future of UK exports. But instead, they are sending a message to the world that the UK under this Conservative government, doesn’t support smaller businesses, doesn’t take international trade seriously, and when it comes to major export opportunities – it just doesn’t bother showing up.”
For the full story from Business Insider UK, click here