At the start of a three day trade trip to Brazil, the Chancellor George Osborne, announced the next stage in the government's fundamental overhaul of finance for British exporters.
The Budget announced expansion of public-sector direct lending; today (Monday) the Bank of England announced plans to support expansion of private sector lending for exporters. These measures will move the UK to the top of the global league for export support.
In a speech to business leaders in Rio de Janeiro, the Chancellor:
- announced, following discussions with the Governor, a significant step to increase availability and cut the cost of private-sector lending for exporters, and welcomed the Bank of England giving finance guaranteed by UK Export Finance (UKEF) access to its Sterling Monetary Framework facility, to help make such lending less risky; and
- confirmed a doubling in size of the UKEF direct publicly-financed lending facility for exporters to £3 billion and the cutting of its interest rates by a third.
Taken together these measures for private and public export finance , which have been welcomed by key British exporters will help achieve the government’s aim to give the UK the most competitive export finance in Europe and put it on a par with the United States. In 2012-13 UK Export Finance provided loan guarantees worth over £2 billion in total. Today's new announcement could help reduce the cost of private-sector export finance loans by 5 to 10 basis points.
Following the Budget, the British Exporters Association (BExA) revised its rankings to show that the UK now has some of the most competitive support for export finance.
The Chancellor also announced:
- UK Trade and Investment (UKTI) will invest £4 million a year to triple the number of mid-size business advisors to support the export ambitions of 3000 companies, as part of its new strategy; and that
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