Business News Round Up (29/03/2021)
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One in four SME exporters halts sales to EU
Almost one in four (23%) SME exporters have temporarily halted sales to European Union (EU) customers and 4% have stopped permanently because of new trading rules. The first full quarter of post-transition trading comes to a close on Wednesday. The day also marks two years since the original Brexit date that firms were told to prepare for in 2019. According to an FSB survey, one in ten (11%) exporters are considering halting sales to Europe permanently. The same proportion have established, or are considering establishing, a presence within an EU country to ease their exporting processes. A similar number (9%) are thinking about securing, or are already using, warehousing space in the EU or Northern Ireland (NI) for the same purpose. Small importers are also hard hit by new paperwork, though fewer than one in five have temporarily suspended purchases from the EU (17%), and a smaller proportion are using EU or NI warehousing space (6%).
Scottish economic recovery could outpace UK average – KPMG
Scotland’s economic recovery from the pandemic over the next two years could outpace the UK average, a forecast from KPMG has suggested. Figures estimate the country’s economy took a 9.6% hit in 2020 – with the impact felt in almost every sector – while across the UK there was a drop in GDP of 9.9%. But the latest “best-case” analysis from KPMG suggests a continuing successful vaccine rollout and a potential post-restrictions “consumer bounce” could result in Scotland recording annual GDP growth in 2021 of up to 5.5% – compared to 4.6% UK-wide. This would grow again to 5.8% in 2022, compared with 5.6% across the UK.
https://www.insider.co.uk/news/scottish-economic-recovery-could-outpace-23812867
SMEs bet on post-Covid-19 bounce with more than 25% planning investment boost in 2021
More than a quarter of SMEs surveyed plan to invest more in their businesses in the year ahead than during a typical pre-pandemic year, underlining their focus on growth in a post-Covid-19 future. Over a third of SMEs plan to invest between £10,000 and £10 million this year, a rise on 32% from 2020. The research is reported in the Virgin Money Business Pulse, which provides a comprehensive insight into the performance of the UK’s SMEs and the environment in which they operate. There’s more good news in the latest Virgin Money Business Pulse, where the business creation indicator was at a record high in the last three months of 2020 as the annual growth rate in the number of registered companies surged to 8.3%. That’s the highest since the Business Pulse began in 2014 and highlights growing confidence among entrepreneurs.
Multi-billion cost of ‘lost summer’ of international travel highlighted
The “catastrophic impact” that only a limited reopening of travel from May is outlined in a new report commissioned by the UK aviation sector. It highlights the cost of a ‘lost summer’ of international travel – £55.7 billion in lost trade and £3 billion in tourism GDP if reopening delayed until September – putting around 574,000 jobs at risk including 73,000 within UK tourism. Being unable to re-open to the EU would cause the most damage, followed by the US, with no transatlantic air links until September costing the UK £2.4 billion, or £23 million a day, putting 51,600 jobs at risk. The warning comes ahead of the reinstated government Global Travel Taskforce due to report in April on ways of reopening international travel from May 17 at the earliest as part of Boris Johnson’s roadmap to relax Covid-19 restrictions.