UK Export Performance

Afzal Khan Excerpts

Monday 18th September 2023 Commons Chamber

[Afzal Khan (Manchester, Gorton) (Lab)]

I thank the committed colleagues on both sides of the House who are here on a quiet Monday evening for their contributions to the debate. It has provided an important opportunity for us to recognise that, for all the Government’s talk about signing free trade agreements across the world and bringing British businesses a step closer to selling to new markets with fewer hurdles, the UK’s export performance is not actually looking very promising. I ask Conservative Members who are advocates of trade and exports to look carefully at their own leadership. If they did so, they would realise how much Britain and British industry have been let down.

Let us look at the facts. The Office for Budget Responsibility predicts that exports will fall this year and again next year, and that over the next three years, with more of the same Tory failure in our economy, the UK’s growth will be weak at best. Tory Governments are quick to claim that they are the “the party of business”, but when I talk to businesses in the city of Manchester and across Great Britain, that is not what I hear. The Prime Minister and his Government, and all those Prime Ministers of the last few years who came before him, promised “growth, growth, growth”, but what do exporting businesses see? They see out-of-control inflation, no progress on trade deals, and a Government who not only do not take their concerns seriously, but sometimes cannot even be bothered to meet them to hear those concerns. They see failure after failure, and because of all that, Britain is set to be 15 years late in achieving its £1 trillion export target.

The Government claim to believe that only trade can create jobs, drive growth and deliver the long-term prosperity that communities across the UK have been crying out for, but when it comes to delivering it, they are nowhere to be seen. It is true that the UK has started negotiations for trade agreements with some of the world’s largest and growing economies such as the US, India, Canada, Mexico, the Gulf Co-operation Council, Israel and Switzerland. We left the European Union in 2020. How many of these trade deals have been concluded? None.

The fact that we have been unable to conclude a deal with one of our closest allies, the United States, is frankly embarrassing, yet the Prime Minister freely admitted on his way to meeting President Biden that a trade deal with the world’s largest economy was not “a priority”. That says it all, doesn’t it? Despite the UK’s deep and historic ties to India, the Prime Minister failed to make any progress on a trade deal there last week. I guess that was not a priority either. And in Europe, our next-door neighbour and largest trading partner, UK businesses are far less competitive and swamped in red tape because the Government failed to get a decent Brexit deal. Again, not a priority. So long as trade and exports are treated as unimportant by the Government, there will be no new markets, goods exports will continue to fall and UK businesses will suffer. The last time more than 30% of businesses saw increased export sales was at the end of 2018, almost five years ago.

[Aaron Bell]

I am grateful to the hon. Gentleman for giving way. I very much enjoyed our trip to the United States earlier this summer as part of the British-American Parliamentary Group exchange. He will know that the reason there is not a trade deal with America is because of the state of American politics and the protectionism we have seen from the Democratic Administration through the Inflation Reduction Act. Also, America is unlikely to negotiate a free trade deal in the run-up to the presidential election next autumn, but that does not mean that this Government are not ambitious for that deal in the longer term. I welcome the hon. Gentleman to his new role, but he has to appreciate that trade deals take two to tango. This country has always prioritised free trade and we will do as many deals as we can with like-minded countries.

[Afzal Khan]

I thank the Member for his intervention. I too enjoyed our trip together—I learned so much about the American system—but can I remind him that that trade deal was in his manifesto?

The truth is that British exporters are at the end of their tether with this Government, and with the meagre support services that our Department for Business and Trade is providing. They find themselves unable to access up-to-date information and they are struggling to find guidance on how best to get their goods out into the world. It is worth noting that trade and export are not about big businesses. They are about the small and medium enterprises that make up 99.9% of UK private sector businesses. These businesses bear the biggest brunt of the Tories’ hopeless approach to improving export performance. Between April and June of this year, over half of all SME exporters saw no change in overseas sales, and almost a quarter reported a fall in sales. That is 16 million people employed in SMEs who are being failed by the Tories, but as my hon. Friend the Member for Harrow West (Gareth Thomas) set out at the beginning of the debate, it does not need to be this way.

Businesses of all sizes should be able to have faith in a Government who work for them, who are pro-trade, pro-business and pro-workers and, crucially, who take a leading role in driving exports from towns and cities across the UK. A Labour Government would not only introduce a binding duty on trade negotiators to help deliver economic opportunities across the whole of the UK; we would also ensure that each new trade deal was accompanied by a regional strategy with support for businesses, maximising the benefits from trade deals across our nations. Sadly, this is not the Tory Government’s priority.

So much needs to be done to restore the faith of British businesses in our trade and export capabilities, and to show the world that the UK is open for business. I am afraid that, once again, the Tory party has shown that it is just not up to it.