When New Electronics surveyed its readers in 2013 to determine the critical issues affecting the electronics industry, one of the themes that became evident was that companies were finding it difficult to break into new markets. Something is obviously not working, but what?
Looking to find out more, Ed Balls and Chuka Umunna – whilst members of the Shadow Cabinet during the last government – commissioned a report from Graham Cole, chairman of AgustaWestland. And Cole's conclusion is that, while a number of welcome initiatives has been put in place, more needs to be done. If the Government is serious about exports, the report contends, it needs to commit resources.
Alongside a call for exports to receive the 'highest possible political leadership', Cole's report also suggests reform to the relationship between UK Export Finance (UKEF) and UK Trade and Investment (UKTI); a 'one stop shop' for export support; a public procurement strategy that brings UK SMEs into the supply chain; and getting trade and exports on the education agenda.
Exports, of course, will only grow if the products being made in the UK have global appeal – on functionality, cost or both. Sectors such as defence and automotive – whose products have substantial electronics content – are contributing, but exports need to be underpinned by a strong UK electronics sector. There is no value to the UK electronics supply chain in a car builder, for example, importing electronic subsystems, integrating them here, then sending them somewhere else; those subsystems need to be designed and built in the UK.
Cole's report calls for a 'step change' in the UK's export performance, but the Government can only do so much. In the end, whether the UK can become the net exporter which George Osborne desires comes down to UK companies developing products that other markets want.
