Government provides £600 million in support for manufacturing sector exports
Published: 19 July, 2016
UK Export Finance (UKEF), the UK’s export credit agency, reports it provided £600m in support for exports in the manufacturing industry from April 2015-March 2016. UKEF’s annual report and accounts, published recently, show that the department has supported the largest number of exporters in 25 years in 2015/16, with a 23% increase since last year.
77% of the exporters that benefited from finance and insurance from UKEF were small or medium-sized enterprises (SMEs), and an estimated 7,000 companies in exporter supply chains also indirectly benefited.
Companies supported include Glasscoat International, a Dudley-based manufacturer of machines used to coat glass bottles, many of which have supplied bottles to some of the world’s biggest cosmetics and beverage brands, including Revlon, Absolut Vodka, Bombay Sapphire and Polo Ralph Lauren. Last year, Glasscoat won two contracts in Austria Germany, and negotiated up-front payments to support its cash flow fulfilling the order. Both buyers requested advance payment guarantees from Glasscoat’s bank, HSBC, in return for which HSBC would require cash collateral as security. Under its bond support scheme, UKEF provided a guarantee to the bank to cover 80% of the bond, thus enabling the bank to release £370,000 cash back to Glasscoat to use as vital working capital.
Ian Cripps, founder and managing director of Glasscoat, said:
“Without UKEF’s support, we could not have fulfilled both contracts, and we would have had to turn away a customer. Working with UKEF meant that we were able to sell a machine in Germany and increase our revenue by £710,000.”
Gordon Welsh, UKEF’s head of business group, said:
“UKEF is here to help make exports happen. Our support for companies like Glasscoat International shows how we can help UK businesses in manufacturing realise their ambitions to grow by exporting overseas.”
Lord Price, Minister for Trade and Investment, welcomed the results, saying:
“Exporting can help businesses grow – and grow fast. That means more jobs, more profits, more tax revenue and more benefit to society. By providing its innovative support to more exporters than ever before, UKEF is helping to make exports happen, playing a vital role in the whole-of-government push for 100,000 new exporters by 2020.”
Louis Taylor, UKEF’s chief executive officer, added:
“UK Export Finance’s mission is to ensure that no viable UK export should fail for lack of finance or insurance from the private sector. This year’s results show that we are making significant progress in reaching a wider customer base. We will continue to be innovative and flexible, anticipating the needs of exporters and finding ways to meet them.”
This announcement comes a year into the Exporting is GREAT campaign, the government’s drive to empower 100,000 new companies to sell overseas by 2020.