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Brexit win for the Tories as post-EU boom hits British service exports

NewsBrexit win for the Tories as post-EU boom hits British service exports

Remainers have been left embarrassed after new data analysis revealed that there has been an explosion in British exports since the UK voted to leave the EU.

Between 2016 – the year of the EU referendum – and 2022, Britain’s exports of services around the world grew dramatically, by 17.8 percent in real terms.

This represents the strongest growth in the G7, according to Telegraph analysis of OECD data.

The growth beats out Italy, Germany, France and vastly outweighs that seen by Japan and the US.

Only Canada achieved a near-similar increase in exports.

In 2022, Britain beat its previous records, rising to £397 billion.

Despite warnings about the value of the British pound after Brexit, an economics expert from the University of Nottingham says that the weaker pound has aided the country’s service export boom.

Professor Gregory Thwaites said that while markets had judged that Brexit would harm the economy by restricting exports, the lower value pound had in fact helped service exports.

“You can actually have a situation where Brexit kind of boosts services trade by harming another sector more.

“It means that – somewhat counterintuitively – the flip-side to the much-highlighted weakness in goods is an improvement in services.”

Service exports include everything from Britain’s burgeoning film industry, enrolling students at UK universities and architecture.

Sophie Hale of the Resolution Foundation told the Telegraph that the rapid growth in services exports came despite companies selling less to the EU.

“It does look like there is a change in the focus of UK exporters in terms of focusing more on non-EU markets,” she said.

Ms Hale said that even while taking into account changing demands, the improvement in Britain’s services exports performance over the past decade holds up.

After the USA, the UK remains the second-largest exporter of services in the world, accounting for around half of what Britain sells to other countries – much higher a proportion of exports than the rest of the G7.

Thomas Sampson, an LSE professor, told the Telegraph that the UK’s success in services exports is largely down to specialising within those industries.

“As the UK has become increasingly specialised in those industries, we have seen it reflected in strong export performance for the services. For goods, we’ve seen over many decades the gradual decline of the UK’s manufacturing base and that obviously places a drag on such exports.”

Things may further improve over the coming years, as developing economies in China, India and Africa get richer.

As emerging economies move on from buying physical goods to improve their quality of life, they will increase the amount of imported services, such as education and entertainment.

Mr Sampson said he “would be surprised to see that over the next decade or two we move to a position where services account for the majority of the UK’s exports”.

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