UK exporters have been given more than £12bn in state financial support to keep Britain trading with the rest of the world through Brexit and the pandemic.
UK Export Finance, the government’s export credit agency, provided British businesses with the highest level of financial support in 30 years in the 12 months to the end of March, according to its annual report published on Wednesday. This is almost treble the amount from the previous financial year, to help exports to 77 countries.
The agency aims to support viable UK exports with loan guarantees, insurance and direct lending to help them win, fulfil and get paid for international business where there are gaps in private sector provision.
UKEF provided more than £7bn in support to companies disrupted by the pandemic, such as Rolls-Royce, Ford, easyJet and British Airways, with a mixture of trade guarantees and insurance to encourage private sector lending to exporters.
It also helped exporters facing Brexit risks, for example providing a £480m guarantee on a £600m commercial loan in March 2021 after a carmaker committed operations to the UK.
UK exporters, especially smaller businesses, have complained about extensive red tape and costs arising from trading with the EU after Brexit.
Many have also warned that the trade deals struck by the government have yielded little benefit so far, instead causing them to rejig operations and move production and distribution overseas.
“We are opening up the world’s fastest-growing markets through the trade deals we are negotiating so that the UK can recover as quickly as possible from the pandemic,” said minister for exports Graham Stuart.
Support through finance and guarantees was given to 549 companies, more than double the number helped over the previous two years.
The agency also underwrote its largest ever civil infrastructure project, with £1.7bn in guarantees to build two monorail lines in Cairo and provide the trains, the first such exports in more than 12 years.
The export agency is now planning to increase its coverage of businesses focused on zero carbon initiatives.
Stuart will say on Wednesday that UKEF will create a renewables, energy and carbon management team to underwrite activity across sectors such as wind power, solar, green hydrogen, grid resilience and decommissioning. UKEF has also committed to ending support for new fossil fuel projects overseas.
Last year, UKEF launched a new scheme to encourage trade after Brexit and for small businesses to take advantage of new trade agreements.
Under this, exporters could apply for larger loans from the UK’s five high street banks backed by an 80 per cent guarantee that can be used both to cover costs linked to exports and also to scale up business operations.
Marcus Dolman, co-chairman of the British Exporters’ Association, said that such new products were “already proving their value to UK exporters and to supporting UK jobs”.