UK trade deals do not significantly benefit small businesses, according to a British Chambers of Commerce survey of over 4,600 firms. Most SMEs with fewer than 10 employees report limited export engagement, while larger companies see growth. Enhanced support for small exporters is essential to realize trade potential and boost GDP.
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84% of small firms with 10 or fewer employees receive too few export orders or rarely trade internationally.
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Larger businesses with 250+ employees report 42% growth in exports, highlighting a widening gap.
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Post-Brexit, UK exports to the EU have dropped nearly 30%, with over 16,000 small enterprises ceasing EU trade, per World Trade Organization data.
Discover how UK trade deals are failing small businesses in 2025. BCC survey reveals SME export struggles amid new agreements with Australia and Japan. Learn expert calls for support and digital solutions to unlock growth.
What Impact Do UK Trade Deals Have on Small Businesses?
UK trade deals have limited positive effects on small businesses, as revealed by a comprehensive British Chambers of Commerce survey. The study of 4,638 firms, predominantly SMEs, shows that 84% of companies with 10 or fewer employees either lack sufficient export orders or seldom participate in international trade. This disparity underscores the need for targeted support to help smaller enterprises access new markets effectively.
How Are Larger Companies Benefiting More from These Deals?
Larger companies with established resources and supply chains are faring better under the new UK trade deals. According to the British Chambers of Commerce Insights Unit, 42% of firms employing 250 or more people have experienced growth in export orders. William Bain, head of trade policy at the BCC, described these findings as “deeply worrying,” emphasizing the growing divide between small and large exporters. He noted that without additional aid for smaller firms, the full benefits of trade agreements remain unrealized. A potential 25% boost in UK exports could enhance long-term GDP growth by 0.6%, but this hinges on enabling small businesses to enter new markets. The World Trade Organization’s recent UK trade policy report echoes these concerns, indicating that the country’s export contribution to GDP has stabilized at pre-pandemic levels. Since Brexit, exports to the European Union have declined by almost 30%, and more than 16,000 small enterprises have stopped exporting to the bloc.
Frequently Asked Questions
Why Are Small Businesses Struggling with UK Trade Deals?
Small businesses face barriers like limited resources, bureaucratic hurdles, and insufficient government support in leveraging UK trade deals. The British Chambers of Commerce survey highlights that 84% of SMEs with minimal staff rarely engage in exports, needing better access to funding, education, and digital tools to compete effectively.
What New Trade Agreements Has the UK Signed Recently?
The UK has finalized trade deals with Australia, Japan, New Zealand, and members of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership. Ongoing talks include India and a renegotiated digital trade pact with the US. These aim to expand market access, but small firms remain sidelined without tailored assistance.
Key Takeaways
- Disparity in Export Growth: Small firms see minimal benefits from UK trade deals, while 42% of large companies report increased orders, per BCC data.
- Post-Brexit Challenges: EU exports down 30%, with 16,000+ SMEs exiting the market, as noted in World Trade Organization reports.
- Call for Action: Invest in trade education, digitization, and advisors to help small businesses; propose a Trade Accelerator for simplified customs and grants.
Government Signs Trade Deals, but Small Firms Still Struggle
Despite a series of new agreements, small businesses intended to be empowered by these UK trade deals are largely disconnected from the opportunities. The government has secured pacts with Australia, Japan, New Zealand, and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership members, while advancing discussions with India and updating the digital trade deal with the US. However, business groups like the BCC argue that support mechanisms are outdated and overly focused on larger entities.
William Bain stressed that the effectiveness of trade deals depends on companies’ ability to utilize them. He advocated for government investments in trade education, digital infrastructure, and local export advisors to prevent small businesses from being excluded. In response, the Department for Business and Trade claims proactive measures, including raising UK Export Finance lending limits from £60 billion to £80 billion to provide affordable funding for small exporters. Officials assert that promoting exports drives productivity, job creation, and economic expansion. Yet, reports from sources indicate behind-the-scenes cuts, with a Financial Times survey citing three private sources on a 20% workforce reduction at the department. This includes regional advisors crucial for one-on-one aid to small firms.
Experts Call for Digital Trade Solutions and Hands-On Help
Experts urge the government to simplify export procedures and adopt digital trade systems to aid small businesses under UK trade deals. Chris Southworth, secretary-general of the International Chamber of Commerce UK, pointed to structural barriers impeding growth for the smallest enterprises. Key issues include the paperwork-intensive bureaucracy post-EU departure, limited access to affordable trade credit, and unclear information on market regulations.
Small businesses need robust digital platforms, reliable cost predictions, and security assurances for goods movement. The BCC proposes a “Trade Accelerator” initiative featuring online exporter training, streamlined customs processes, and targeted grants for first-time international ventures. The organization recommends that the Chancellor outline this plan in the upcoming Budget to safeguard global growth opportunities. Bain reiterated that without such interventions, the economic upside from trade deals—potentially adding 0.6% to GDP—will elude smaller players.
Conclusion
In summary, while UK trade deals with nations like Australia and Japan promise broader market access, small businesses continue to struggle due to resource gaps and inadequate support, as evidenced by the British Chambers of Commerce survey and World Trade Organization insights. The widening divide between SMEs and larger firms risks stalling export-driven growth. To bridge this, targeted digital solutions, funding, and advisory services are vital, ensuring all businesses can contribute to a stronger economy moving forward.
