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12th October 2023

Chambers comment on GDP and trade data

Today (12 October), the ONS released the trade and GDP for August.

The value of goods imports increased by £0.8bn (1.7%) in August, with a rise in imports from non-EU countries and a decrease in imports from EU countries. The value of goods exports decreased by £0.7bn (2.2%) in August. There was a fall in exports to non-EU countries and exports to EU countries remained stable.

GDP grew by 0.2% in August and increased by 0.3% in the three months to August.

Oliver Carpenter, Policy Manager at Chambers Wales South East, South West and Mid, said:

“Despite recent positive economic steps such as an interest rates freeze and inflation falling, the economy and trade is continuing to stagnate as the minimal rise in GDP and August’s trade figures show.

“Policymakers and business representative organisations need to collaborate to ensure that businesses get the resources they need to begin or expand their international trade journey. Our Quarterly Economic Survey for Q3 of 2023 shows that almost half of businesses in Wales are not engaged in international markets and that those who do export to overseas markets have seen sales and orders remain constant or decrease over the last three months.

“Businesses who trade internationally are generally more successful, flexible and resistant to economic shocks. It is essential that businesses are provided the tools and access to markets they need, to not only grow the economy but bolster it.

“Similarly, support for businesses domestically would also help improve GDP. One in six high street businesses across Wales are empty. SMEs are founded on the communities they exist in and rekindling the high street to boost a localised trading culture for our businesses is a considerable challenge that needs to be met head on by policymakers, local authorities and the private sector.”


David Bharier, Head of Research at the BCC, said:

“With GDP growing by 0.3% in the three months to August, and by 0.2% on a monthly basis, the UK economy is holding up but remains in a precarious state. The production sector in particular has seen worrying data revisions showing stark monthly falls in growth.

“Our research is clear about the issues UK firms are facing – three years of economic shocks, high inflation and interest rates, skills shortages, and trade barriers with the European Union. Consequently, most SMEs report no increase in their investment plans.

“Businesses need to see a strategic vision for the long-term framework for investment in the UK. Recent policy announcements around projects, such as HS2, will have generated more uncertainty for businesses searching for stability.”

William Bain, Head of Trade Policy at the BCC, said:

“August was not a good month for UK goods exports. There were falls in both EU and rest of the world trade – where after removing the effects of inflation, volumes fell by 7.2% month on month.

“The export gains of July went into reverse during August, which brings the UK more into line with the global trade picture for June-July this year.

“On the services front, it was another broadly flat month for UK exports – suggesting that the growth in overseas demand for services from last year is not being sustained. This may be a function of weaker than expected global economic conditions, especially in consumer spending.

“The overall picture on UK goods exports volumes to the EU has been flat over the last 18 months, when you remove the effects of inflation. The BCC has recommended several areas where this could be addressed, including a veterinary deal, youth mobility schemes, and improved conditions for firms on VAT compliance and fiscal representatives.”

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