International trade is set for a dramatic sea change in the UK, with a potential no-deal Brexit looming and businesses unsure where to place their loyalties. Roughly a third of UK exporters have already lost business directly due to Brexit and leading forex companies such as OANDA are expecting the pound to continue to perform poorly leading up to the deadline.
Businesses that rely on import and export to survive are bracing for a rude awakening in March next year, but there are signs of encouragement to be gleaned from certain corners of the business world.
Amazon is expanding its UK operations, with a new office set to open in Manchester and an expansion planned for two other national centres as part of a “major new investment in British innovation.” This equates to 1,000 new R&D roles, with 600 corporate and development jobs open in Manchester, 180 in Cambridge and 250 in Edinburgh.
Manchester also makes perfect sense as an operational hub for Amazon, due to the city’s major airport (which boasts frequent, direct flights to countries such as Dubai and the US). HS2 is also on the horizon, which will offer greater connectivity between Manchester and the rest of the UK, giving the region’s exporters better access to the channel tunnel and other ports as well as London’s aviation hubs.
The great white whale of online retail has invested over £9 billion in Britain since 2010 and they stand alongside US tech giants like Apple, Google and Facebook as major companies that are willing to stand behind Britain despite the turmoil being stirred up by Brexit.
With Ernst & Young (EY) revealing that 34% of the companies they monitored, had “publicly confirmed their intentions to move some of their operations and/or staff from the UK to Europe,” it’s encouraging that some of the big boys are standing behind the UK.
Liam Fox MP, Secretary of State for International Trade, said: “Amazon’s decision to create hundreds of highly-skilled jobs in Manchester, Edinburgh and Cambridge is an enormous vote of confidence in the UK and a signal to the world that the UK is very much open for business.” This is wonderful news for import and export businesses.
With Amazon and their Silicon Valley peers standing behind the UK, it sets a precedent for other companies that might be considering dialling down their investments in the country. This could hopefully lead to more businesses and brands making a point of standing their ground and keeping their UK offices open.
The new Amazon jobs are said to be “Silicon Valley” jobs, according to UK country manager Doug Gurr. This means a heavy focus on technologies like machine learning, the Prime Air drone delivery project and, of course, the Alexa virtual assistant. The tech sector is, in fact, one area in which the UK is currently thriving and tech importers and exporters will no doubt be thrilled to learn of Amazon’s increased commitment to technology.
The fact that it’s primarily US companies showing their support is also very encouraging indeed, given that import and export businesses will depend more on US trade in the coming months. Indeed, it would appear that whilst UK importers and exporters might need to make a few major adjustments in the coming months, there are still plenty of opportunities to be taken.