UK EXPORT FINANCE OCTOBER 2019
EXPANDING
YOUR HORIZONS
Manufacturing contributes £6.7 trillion
Manufacturers looking to expand overseas can get support from UK Export Finance
BY DAVID PRIESTLEY, HEAD OF EXPORT FINANCE MANAGERS, UKEF
to the global economy, according to
fi gures from Make UK, and in the
UK this industry is thriving. We are
currently the world’s ninth largest
industrial nation and on track to
expand and reach the top fi ve by 2021.
This important sector underpins much of the
UK economy – Make UK’s fi gures also show that
it gives jobs to millions, makes up 70% of business
research and development, and accounts for 44%
of all UK exports. That is why UK Export Finance
(UKEF), the UK’s export credit agency, provided
over £3.5 billion of support to exporters in the
manufacturing industry over the last year.
UK manufacturers continue to impress,
punching above their weight globally, and UKEF
aims to ensure that no viable export fails due to
lack of fi nance so that the industry can continue
to reach its full potential. Academic research
shows that companies selling overseas with access
to trade fi nance have export volumes that are
as much as 60% higher. For this reason, UKEF
supports companies of all sizes. We do this in three
main ways: helping exporters win contracts, fulfi l
contracts and get paid.
Pipe manufacturer Carpenter & Paterson is an
example of a company that benefi tted from UKEF’s
support: thanks to UKEF providing India-based
Reliance Industries with a £300 million guarantee
on the condition that goods and work were sourced
from the UK, Carpenter & Paterson secured over
US$9 million in revenue over two years, helping
to create dozens of jobs. It was the single largest
project Carpenter & Paterson had ever taken
on,and resulted in an increase of over 50% in
revenue for the company.
Another of the companies UKEF has supported
is Welsh manufacturer, Flamgard Calidair, who
design and manufacture high-integrity fi re
safety equipment. The company was contracted
to provide fi re and shut off dampers for the
Chernobyl New Safe Confi nement site. This was
a huge, international contract for Flamgard that
would allow them to cement their position in the
global marketplace. However,
before they could fulfi l the
contract, Flamgard needed
additional fi nancial support
for an advance payment bond
they had to issue as part of their
involvement with the project.
Flamgard secured backing from
Lloyds Bank, while UKEF’s
guarantee meant that there was
no requirement for a deposit.
Another example of
UKEF support in action is
Northampton-based cleaning
products manufacturer,
Bioguard Hygiene. After winning
an export order with a large
pharmacy chain in the Middle
East, the company sought out
extra protection in case there
were any diffi culties with
their increased production. As
most of Bioguard’s business is
domestic, the company only
wanted a standalone insurance
policy covering its new Middle
East business, but struggled to
fi nd single-market cover from
the private insurance market,
so they worked with their local
UKEF export fi nance manager
UKEF has over
100 years of
experience with
export advice for
manufacturers
who developed a bespoke export
insurance policy to protect
against the risk of non-payment
by an overseas buyer. Without
this, Bioguard Hygiene would
not have been able to take on
this order and take a big step
into an important market.
In the manufacturing sector
and beyond, opportunities
can be limited within a local
market due to competition or
market saturation. Exporting
off ers businesses the chance to
break through that barrier and
capitalise on global market need.
There is great global demand
for UK exports thanks to its
impressive track record as a
strong trading nation. There is
also potential for much more –
and this is where UKEF can help.
We work with more than 100
commercial lenders and brokers
to off er government-backed
loans, guarantees and insurance
to support companies’ overseas
sales. In the last fi ve years alone,
UKEF has provided £17 billion
worth of support for UK exports
across a multitude of sectors.
Since being founded 100
years ago, UKEF has led the way
in delivering innovative fi nance
to help British companies
achieve international success
across a wide range of industries
across the world. Looking to
the future, we will continue to
get behind the manufacturing
industry, providing fi nancial
backing and further support in
exporting, ultimately aiming to
bolster the sector’s position in
the global market.
42 www.manufacturingmanagemnet.com
/www.manufacturingmanagemnet.com