After two months of growth the June 2022 trade data showed economic headwinds are now having a real impact on UK businesses, and government support is vital if it is not to deteriorate further, said BCC head of trade policy, William Bain.
“The 8 per cent fall in goods exports values for the month was driven by a range of factors across fuel, chemicals, transport equipment and other manufactured goods, but there are gathering economic headwinds which all UK exporters now face,” Mr Bain said.
“As well as general economic measures to support growth in the months ahead, this data shows the risks of weakening, instead of stabilising, our trade relations with the EU.”
The BCC said the previous two months of stronger growth in goods exports came to a halt in June as overseas sales fell and the trade deficit widened.
April and May had both produced 7.4 per cent month-on-month rises in UK goods exports but in June there was a fall of 8 per cent.
EU goods exports were down by 3.9 per cent (a rise in chemicals exports offset by lower machinery, transport equipment and fuels exports) and non-EU goods exports slumped by 11.9 per cent (across many product categories including miscellaneous manufactured products).
The overall trade deficit in goods and services widened by £2 billion in Q2 2022 to a record £27.9 billion (£22.6 billion excluding inflation).
Overall, in Q2 goods imports to the UK increased by 8.3 per cent compared with Q1, and goods exports by 12.4 per cent. UK goods export values to the EU rose across the quarter by 16.3 per cent (strengths in fuel re-exports and ships, aircraft and mechanical machinery) and to the rest of the world by 8.6 per cent even taking into account June’s disappointing data.
UK goods imports declined by 1.1 per cent in June, driven largely by a 4.1 per cent fall in goods imported from the EU (mainly in chemicals from the pharmaceutical sector) offset by a 2.1 per cent rise in imports from the rest of the world (largely fuel import rises from the US and Norway).
Comparing trade performance in Q2 2022 with the same quarter four years previously, overall goods exports were 11 per cent higher in Q2 2022, and imports 31 per cent higher.
