A new export strategy could give a £20bn lift to the UK economy by the end of the decade, according to the Confederation of British Industries (CBI), which is proposing that the government focus on high growth emerging markets.
The UK's largest single export market is the US, followed by several eurozone countries. Combined, British exports to the 'BRIC' countries - Brazil, Russia, India and China, are just 4% of the total.
A new report by the CBI and Ernst & Young, released on Monday, advised reforming UK Trade and Invest (UKTI) and the export credit system in an attempt to target emerging powers.
UKTI should have 50% representation of businesspeople on its board, the report said.
As well as the BRICs, the UK needs to focus on other high growth economies, including Bangladesh, Egypt, Turkey, Indonesia, Iran, Mexico and Nigeria, the CBI said.
“The UK has a proud history as a great trading nation, but in recent years our performance has been lacklustre," CBI director general John Cridland said. "Exports success will be one of the key drivers of growth, but for too long we have been over-dependent on advanced economies for our trade.
“The continued crisis in the Eurozone underlines just how important it is for the UK to diversify its export efforts to high-growth countries. Given that we’re already playing catch-up with many of our competitors, we must act now or never to target high-growth economies, leapfrog the competition and deliver our growth potential.
The construction services, electrical and optical goods, telecoms and financial services sectors all have strong export potential, the report said. The chemicals sector was singled out as having failed to target itself well geographically.
Picking the right markets and focusing more on industrial chemicals could have boosted the industry's exports by 15% in the last decade, according to the CBI.
“Our inability to break into and succeed in high-growth markets is due to a historic mismatch between the goods and services we currently sell and those demanded by high-growth economies," Steve Varley, UK and Ireland managing partner at Ernst & Young, said.