Dubai Business Forum – November 2024

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We’re delighted to be able to invite our internationally trading members with an interest in Dubai to attend the Dubai Business Forum UK, powered by the Dubai Chamber.

The event takes place on Thursday 14 November, 08:30 – 16:00 in London.

The Forum aims to strengthen the long-standing and multifaceted partnership between the United Kingdom and Dubai, a relationship that has historically laid the foundation for substantial bilateral trade and investment. It will highlight new opportunities for collaboration, particularly in the areas of business, finance, education, creative industries, and technology, including green tech and AI.

Dubai’s ambitious D33 economic agenda offers a myriad of opportunities to businesses as it aims to:

  • Promote the growth of the digital economy by attracting tech startups and experts.
  • Strengthen Dubai’s role as a global business enabler and logistics hub.
  • Foster a vibrant financial ecosystem and support innovation and entrepreneurship.
  • Promote sustainable practices and initiatives to ensure long-term economic growth.

Featuring high-level delegates, including industry leaders, key decision-makers, and top-tier investors, the Dubai Business Forum UK will offer an unparalleled platform for networking and forging new strategic partnerships.

If you’re interested in attending the forum, please contact our international trade specialist Nikolai at [email protected].

Chamber International Trade Forum Update – 08/07/2024

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Our forums are designed to support members engaged looking to engage in international trade – a unique opportunity to gain valuable knowledge from across our network of businesses of all sizes and sectors, understand specific support requirements, share best practice, network, and inform NECC’s activity on your behalf.

This time we covered Labour’s new manifesto briefing on plans for business and trade; provided an overview of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), European Union Tariffs on Chinese Electric Vehicles, and the new Carbon Border Adjustment Mechanism (CBAM) taking effect from 2026.

You can find a more detailed summary of the session and takeaways, here and if you do have any further questions for our international trade team, please drop us a note via international trade helpdesk email or contact Eve Halliday directly: [email protected]

Monday’s event marked the re- launch of our International Trade Forum (kindly chaired by Sarfraz Mian – MD, Neue Schule) as part of a wider event series created to ensure our members can thrive internationally. You can also now book on to our next forum and upcoming market insight event via the links below:

  • International Trade Forum: Monday 4th November – book your space here. This event will be in person only.
  • Market Insight Event – INDIA: Monday 23rd September book here. This event will be ONLINE.

If you have any questions regarding your membership, the benefits or specific questions regarding trade, you can contact your engagement manager or message our help desk [email protected]. You can also view information about our full suite of international trade services including consultancy, documentation, customs and training here.

EU Carbon Reporting Update

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The EU’s new carbon border adjustment mechanism (CBAM) went live in October, and whilst the reporting of carbon emissions on selected materials is the European importer’s responsibility, we feel it’s important to provide UK exporters with a quick update on where we’re at.

Currently, CBAM is in a transitional phase, with charges for EU importers based on CO2 used to make goods coming into play in 2026. For now, the only obligation EU importers have is to report on the amount of CO2 being used, with the first report due in January.

Already though we are starting to hear individual cases of exporters being asked for CBAM paperwork for goods containing steel, aluminium, iron, electricity, cement, and some fertilisers. This is challenging as the EU has not produced any standardised documentation for UK exporters to use. We are currently working with the British Chamber of Commerce to help policy makers in the UK and EU understand how this is affecting businesses, as well as calling for a standardised carbon reporting mechanism for exporting goods into the EU. If you are a member of the Chamber who is currently being affected by changes as a result of CBAM, please get in touch at [email protected]. For more information on CBAM, please see our guide here.

Welcoming the Electronic Trade Documents Act

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Promising to make trade more straightforward, efficient, and sustainable, the Electronic Trade Documents Act has been adopted with its provisions set to be introduced in mid-September.

The Act, means that electronic trade documents will be granted the same legal status as physical trade documents.

Minister for Tech and the Digital Economy, Paul Scully, said: “The global container shipping industry generates billions of paper documents a year — and there’s no need for the immense costs UK businesses have to face in producing them, and the detrimental environmental impact that this has. What may look to many of us as a small change to the law is something that will have a massive impact on the way UK firms trade and, in turn, is going to boost our economy by over £1 billion over the next decade.”

Existing laws dating back to the 1800s previously meant that exporters and importers have had to use paper documents to transfer ownership of the goods they are shipping, he went on, creating a costly, inefficient, and outdated way of working.

The Act also covers trade documents such as promissory notes, warehouse receipts, marine insurance policies, and cargo insurance certificates.  The Government estimates that it could generate a net benefit of £1.14 billion for the British economy over the next decade for UK businesses trading across the world.

The Chamber’s head of international trade James Davison said “the Act’s introduction in September will provide a much need boost in digitalising export and import documentation and begin the process of simplifying international trade for our membership.”

UK Export Finance puts billions behind British exporters

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Hundreds of UK businesses ranging from suppliers of solar batteries to life-saving medical equipment have benefited from £6.5 billion in UK Export Finance (UKEF) support over the last year as they attempt to break into international markets.

As the UK’s export credit agency, UKEF provides government-backed loans, guarantees and insurance so that firms across sectors such as life sciences, clean energy and advanced manufacturing can grasp overseas export opportunities that they could not otherwise access.

The value of all UKEF support added up to £4.1 billion to the economy in the last year. Since 2021, it has provided £13.9 billion to businesses and supported up to 127,000 jobs.

Business and Trade Secretary, Kemi Badenoch, said: “Whether it’s supporting the construction of hospitals in Africa or supplying next generation all-electric quad bikes to North America, demand for British products and services remains high. UKEF is playing a major role in connecting local firms from all corners of the UK with exciting opportunities beyond our shores where their expertise is needed.”

Overall, UKEF is now supporting more SMEs than at any time in the last 30 years with 84% of firms directly supported with a UKEF product being small and medium-sized businesses, while 82% are located outside of London.

Many of UKEF’s SME customers over the last 12 months were supported through its General Export Facility (link below) — a platform that gives smaller firms access to trade finance options up to £25 million, without the need of a specific export contract.

UKEF’s capacity has been raised by £10 billion to £60 billion in 2023–24 to help even more businesses to export.

Find out more here.

International Trade Update Q1 2023

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The latest set of international trade figures released by the ONS and HMRC are very encouraging for the UK economy with demand for UK manufactured goods continuing to rise. All UK countries have experienced an increase in the value of exports in Q1 2023 over the same period in 2022.

Q1 2023 has seen the total value of UK exports increase from £83,285 to £91,686 on the same period last year, that’s an increase of 10.03%. For the same period UK imports increased by only 1.41% from £155,070 to £157,262 (figures in £ million).

UK exports to the EU follow the same trend, increasing from £43,840 to £48,394 or 10.39% while EU imports increased slightly slower from £74,560 to £80,787 or 8.35%.

UK exports to the rest of the world (RTW) have increased from £39,444 to £43,612 or 10.57% while RTW imports have shown a marked decline from £80,510 to £76,475 or a fall of 5.01%, which will go some way to ease the trade deficit.

The North East region continues to show positive growth in our export market year on year. Total value of goods exported from the region increased from £2,996 to £3,365, that’s a 12.32% increase on the Q1 2022. It is however a slight drop of 2.09 % on Q4 2002.

Trade to the EU increased for £1,835 to £2,036 or 10.95% while the RTW increased from £1,161 to £1,329 or 14.47%

Imports into the region from the EU increased from £1,968 to £2,095 or 6.45% but fell from the RTW by 10.52% from £2,139 in Q1 2022 to £1,914 in the same period this year.

While these figures are good news for the region, the North East remains the smallest region in England for both exports and imports. Also, as trade grows the number of companies exporting from the region continues to decline as shown in the graph below.

This is a worrying trend that needs to be monitored more closely and may be directly linked to the ongoing increased costs businesses have been facing due to the knock-on effects of the war in Ukraine and our own domestic struggles with high inflation and interest rates.

When you consider the positive news we’ve seen for the North East’s employment, which is starting to close the gap between our region and the rest of the UK, it’s clear that there’s room for optimism. With the significant investment from the private sector which will bring more trade to the region, and further devolution coming next year, there’s a real opportunity to expand on the promising signs we’ve seen at the start of this year.

All data supplied by HM Revenue & Customs Regional Trade in Goods Statistics. The full report can be accessed here.

Photo by Pixabay

Digital Bills of Exchange and Promissory Notes

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Blog post by Dominic Brown at Arqit.

The digital transformation of global trade was turbocharged during the COVID-19 pandemic, with companies and financial institutions needing to find new ways to transact business whilst offices were closed, and staff were working remotely.  Businesses quickly recognised the benefits of exchanging documents digitally to keep the wheels of commerce turning, streamline their processes and reduce costs.  The coming into force of the Electronic Trade Documents Act 2023 (ETDB) will give electronic versions of key trade documents, such as the promissory note, the bill of exchange and the bill of lading, the same legal standing as their paper counterparts.  Looking forward, the International Chamber of Commerce has estimated that digitising trade documents could generate £25 billion in new economic growth by the end of 2024, and free up £224 billion in efficiency savings.

Used for decades as a trusted form of a monetary contract, promissory notes and bills of exchange are being given a new lease of life by the adoption of the ETDB and similar legislation in most major global economies, as part of an initiative to digitise trade documents around the world.  Businesses need to have confidence that a digital trade instrument will be as safe use as a paper document, so the legislation sets out criteria that must be met, including protecting the instrument from unauthorised alteration and securing it so that only one person (or business) can exercise control over it at any one time.  Ensuring that digital trade documents meet these requirements, whilst remaining fully transferrable, is crucial to their adoption.  As a leader in quantum-safe encryption, Arqit has the technology through our unique , quantum-safe, symmetric key agreement platform to offer a solution that gives businesses and their customers peace of mind.

For companies looking to stay ahead of the competition, now is the time to embrace digital tools to stay competitive in an increasingly digital world.  Not only can digital trade instruments deliver process efficiencies, thereby reducing costs and improving customer satisfaction, but they can also help businesses to grow both domestically and internationally.  To find out more, click here.

Retained EU Law Bill Update: No Sunset in Sight

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On Wednesday the 10th of May, the newly established Department for Business and Trade announced it would be making changes to the highly topical Retained EU Law Bill. Whilst the Bill previously had a sunset clause in place for 2023, the Secretary of State for Business and Trade Kemi Badenoch has announced that this deadline will no longer be in place.

For those that aren’t aware, the Retained EU Law Bill was designed to formalise the removal, amendment, or continuation of all the laws the UK has inherited from its former membership of the EU. The Government had set an ambitious deadline of the 31st of December 2023 for over 3,800 laws (and potentially counting) to be considered. If the deadline was not met, any laws not considered would be automatically kept, or repealed using a sunset clause.

Since the early stages of the Retained EU Law Bill we’ve been clear that the voice of businesses and our members must be heard in deciding what laws to keep, change, or get rid of. Alongside our colleagues at the British Chambers of Commerce, we have advocated for an extension of the sunset clause to 2026, to ensure that employer engagement can be done effectively and comprehensively.

The news announced last week creates the potential for a detailed, employer-focused approach to amending EU law. It’s a step in the right direction for giving our region’s exporters certainty, at a time where they will already be preparing for upcoming changes in environmental regulations and documentation.

If you want to feed into our work with the Chamber network on the Bill, get in touch with us at [email protected]

Introducing the Department for Business and Trade

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On the 7th of February 2023 we heard from the Government that they will be making reforms to governmental departments, and with it would come a small cabinet shuffle. One of the reforms is the merging of parts of the Department for Business, Energy, and Industrial Strategy (BEIS) and the Department for International Trade (DIT). This will form the new Department for Business and Trade.

Whilst the current Business Secretary Grant Shapps will move into the newly formed Department for Energy Security and Net Zero, the current Secretary of State for International Trade Kemi Badenoch will now take the post of Secretary of State for Business and Trade.

This comes following Kemi Badenoch’s five priorities for trade, which in brief terms comprise of removing trade barriers, make the UK the top investment destination in Europe, seal trade deals with India and CPTPP, defend free trade, and grow UK exports to reach a value of one trillion by 2030.

So, what does this all mean, and have there been any signs of what work will be at the forefront of the Department for Business and Trade going forward?

In the Government’s own wording, they aim to create a department “with all the levers to unleash the power of British businesses, reform regulation to reduce burdens and unlock Brexit freedoms.”

Considering the Retained EU Law Bill is currently under the jurisdiction of BEIS, this would suggest that this will be the responsibility of the Department for Business and Trade going forward.

As a Chamber we continue to welcome views on the Retained EU Law Bill, with more information available here. We believe that to allow for a thorough consultation period, and to give businesses more certainty, the sunset clause on the Bill should be extended to 2026, and continue to support the British Chambers of Commerce on this stance. We believe this would be beneficial to help the Department achieve its objective of amplifying “engagement between business and government”.

The Department of Business and Trade will also seek to “strengthen our offer to international investors”. As a Chamber we would be keen to explore the detail on this, considering the North East was the most successful English region outside of London last year in terms of creating jobs from private inward investment.

To get in touch with your thoughts, please email [email protected]

Foreign exchange risk management

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Trading internationally can leave your business exposed to the risk of currency fluctuations.  The measure of the risk depends on the currencies paid and received as well as the volume of your business tied to international markets and your future plans for growth.

Taking GBP/USD as a current example, at the beginning of 2022 the rate ran at 1.35 and on 16th September it was 1.15, this currency swing can potentially have a huge impact on the cost of your imports.

Did you know the Chamber can provide a foreign exchange currency audit though our partners Moneycorp, who are able to offer a currency health check that can provide a snapshot of your currency exposure, and can support in the development of a strategy for your business to mitigate that currency risk and cost in the future.

Moneycorp have resources to support with this including developing your currency risk hedging strategy.

Money market hedges allow companies to lock in the value of a foreign currency transaction when making a foreign exchange or transaction. This allows the domestic company to secure the value of its partner’s currency, albeit denominated in the currency used by the domestic company, in advance of the agreed transaction.

These hedges tend to be more complicated than forward contract, but they are ideal in situations where forward contracts are not easily available for a given currency (this can occur when a company is not big enough to obtain a forward current facility from its bank).

You may find that market money hedges are best suited to one-off transactions, due to the fact that they involve a greater number of distinct steps than forward contracts.

To find out more about Moneycorp’s services or as a member of the chamber you can arrange a free currency audit by contacting [email protected]