The state of the global economy remains an issue of concern for the UK's small and medium-sized enterprises (SMEs), but domestic economic conditions are considered to be improving, according to the International Trade Monitor, a survey conducted by Western Union Business Solutions.
The survey, which sampled more than 660 of the UK’s SME importers and exporters, found that the global economy remains a concern for businesses that trade with overseas buyers and suppliers, with 76% of respondents stating that they were worried about the issue. Other concerns expressed include cheaper competitors (cited by 63% of respondents) and currency volatility (cited by 59% of respondents).
While just 56% of respondents expressed confidence in the current economic climate in the UK, 86% of respondents believe that the general business environment in the country will either improve or stay the same in the near future.
With almost one in three respondents (31%) stating that the eurozone crisis will have an adverse impact on their business in the future, the eurozone economy is considered to be an ongoing concern for the UK's SMEs. Three-quarters of those surveyed said that the majority of their export market lies in Europe. Just 13% said that they thought that the conditions in the eurozone would improve by the end of the year.
According to Jonathan Rees, UK regional divisional director at Western Union Business Solutions, the UK's SMEs are reacting to the continuing market conditions plaguing the eurozone by looking to opportunities abroad. Mr Rees said that positive economic news from the US could be further influencing these companies' international strategies. Indeed, 30% of those surveyed said that the majority of their overseas suppliers came from the North American region, up from 23% in the previous quarter.
Recent data from EU-based statistical office Eurostat supports the increased confidence in the UK economy by showing a positive year-on-year real GDP growth rate of 0.2% for the UK, compared with -0.6% in the eurozone. Market fluctuations are also affecting both importers and exporters with sterling moving nearly 5% against the US dollar in the second quarter of 2013, according to Bloomberg.