A New Export Strategy? More like Déjà Vu

The Department for International Trade (DIT) began life in 1999 as 'British Trade International' and in 2003 became 'UK Trade & Investment' (UKTI). The two parent departments, the Foreign and Commonwealth Office and the Department for Business and Anything Else had long squabbled over their mutual responsibilities but BIS got custody until Brexit moved international trade up the Downing Street agenda and UKTI became the DIT.

This week the DIT did not publish a UK export strategy, new or otherwise, but rather the terms of reference for some enquiries intended to lead, sometime this year, to something like that. The DIT has had a lot on its plate, so it is understandable that exports, one of Brexit's key raisons d'être, should have to wait nearly two years before starting to think about them...

These terms of reference are strikingly Whitehall centred. Both the Minister, Baroness Fairhead, and DIT civil servants are going to talk with other departments and then the Minister will 'engage closely with businesses and partners.' Apparently government will now 'allow businesses to benefit from growth opportunities, generating wealth and prosperity for the whole of the UK.' That word 'allow' tells its own tale.

In a similar vein, 'DIT has a range of products and services,' which include 'securing market access for British companies.' Yes, in some markets, trade barriers have to be knocked down at DIT level but the vast majority of exports are achieved by the companies themselves. The terms of reference acknowledge that government support might be improved but the conclusion of this section is that DIT services are fine. British businesses are aware of them.

I have tried to use the DIT digital advisory system and the results were ludicrous. Gin is now made in many parts of the UK, including East Anglia, so I claimed to be a gin manufacturer hoping to export. The system did not recognise gin as a commodity. It asked a whole series of questions to which no neophyte exporter could possibly have sensible answers and then recommended I contact various hasion and beauty retailers and an EU chain of shoe shops.

The DIT is asking businesses these seven questions:

  1. How should government differentiate its support for difference sizes of firm?
  2. How should government prioritise its support across different business sectors and overseas markets?
  3. How should government change its mix of products and services to help businesses achieve a sustained increase in exports?
  4. How should government work with regional and private sector export support to deliver a more joined-up offer for business?
  5. What should government do to increase capacity and capability in the private sector, particularly at a UK regional level?
  6. How should government charge for the services it offers?
  7. Do you have any other comments that you would like DIT to take into account?

There is really only one answer to the first five: government should only do what only government can do. It is incapable of providing digital exporting advice and linkages, so it should stop trying to do so. In the last 18 years, DIT and its predecessors have made extravagant claims for their ambitions and achievements but, overall, those claims have not been substantiated by export performance.

That said, the DIT rightly has its supporters. Trade missions can work well and anything that links British potential exporters personally with relevant foreign importers can be valuable. The word 'personally' is crucial also for UK based on-the-ground export advisors, many of whom are excellent. My quarrel is not with those in the field but with HQ where there is so little realism. How many DIT HQ staff have themselves actually ever exported?

Where governments are involved, the DIT clearly must be too. That means big contracts and big exporters. On the other hand, there is little that the UK part of the DIT can do for small and medium-sized exporters that the British Chambers of Commerce could not do better (and cheaper).

Overseas posts do not get so much as a mention in the new terms of reference and yet they are the most important part of this whole puzzle. Exports are determined by what foreigners will agree to buy, not what British firms are prepared to sell. Good oveseas posts are ace at making these introductions but many are not. The heads of those posts are FCO staffers, some of whom consider trade a little vulgar.

Starting again with a new export strategy could prove far more successful than carrying on as before but the Minister will have to be imaginative and bold. Let's hope she will be.