Smaller UK trade gap as service exports rally

Friday 16 August 2013

Manufacturing output rose in March

UK business has been boosted by a significant fall in the trade deficit during June 2013.

According to the Office for National Statistics, the trade gap fell from £2.6 billion in May to £1.5 billion in June.

A deficit of £8.1 billion on goods was largely offset by a surplus of £6.5 billion in services.

David Kern, chief economist at the British Chambers of Commerce, described the "large fall" in Britain’s trade deficit as "yet more positive news for the economy".

He said longer-term comparisons signal an improvement in the UK’s trading performance.

"Britain’s exporters are now starting to focus more on trade with countries outside the EU. This is particularly encouraging as these countries are growing at a faster rate and will be the ones that provide the greatest opportunities for UK firms," Mr Kern added.

However, despite the improvements, he said the trade deficit is "still too large" and the UK is failing to make enough progress in rebalancing the economy towards net exports.

"Our recent surveys reveal huge untapped potential among British exporters, especially in the service sector, and unleashing this potential will help to secure a sustainable recovery," Mr Kern claimed.

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Posted by Dan Smith