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British Chambers of Commerce: 55% of exporters affected by Red Sea crisis
Mar 12, 2024|
View:124Recently, the British Chambers of Commerce (BCC) released a report showing the far-reaching impact of the Red Sea shipping crisis on the UK economy and society.
In a survey of more than 1,000 businesses by the British Chambers of Commerce (BCC), 55 per cent of exporters surveyed said their export operations had been affected by the Red Sea shipping crisis. 53% of UK manufacturing firms and B2C services are affected.
This impact is mainly reflected in the following two aspects. First, transport costs have soared, with some companies saying their ship leasing costs have increased by 300 per cent as a result of the shipping crisis. Second, the supply time is longer, 3-4 weeks longer than under normal conditions. In addition, companies' cash flow and inventory replenishment are also affected.
William Bain, head of trade policy at the British Chambers of Commerce (BCC), said the longer the current status quo in the Red Sea lasts, the more pronounced the impact on the UK economy and society is likely to be. A Red Sea crisis would further fuel inflationary pressures in the UK.
"Our research suggests that the longer the current situation lasts, the more likely it is that cost pressures will start to build," said William Bain, head of trade policy at the BCC.
Bain further notes: "Certain sectors of the economy are clearly more vulnerable than others. But with the government recently introducing new customs checks and procedures on imported goods, also adding costs and delays, it is a difficult time for businesses."
Bain sees the UK economy seeing a fall in gross goods exports in 2023 as global demand weakened, adding to his plea for the government to provide more support for exporters in the spring Budget.
"We are calling for an export council to refine the UK's trade strategy and review the effectiveness of government export support funds. Overseas trade is essential to our economic growth. "We have to do everything we can to help businesses get through this and then focus on expanding exports going forward."
For British exporters, exports are in a tough state due to a lack of external demand.
