By doubling exports in digital technologies, the UK could produce an additional £23bn for the economy by 2025, “and move up the ranks and become a top global exporter of tech”, according to Gerard Grech, Tech Nation‘s CEO.
The UK’s total global exports in digital technologies are expected to reach £31.45bn within five years, according to recent forecasts by Oxford Economics, boosting the nation’s total exports by £8.15bn.
Published ahead of London Tech Week, a virtual event that kicks off on 8 September, Tech Nation’s Unlocking Global Tech report delves into the value of the UK’s tech industry, exploring the challenges and opportunities presented by a post-COVID world.
The report found that in 2019, the UK was the world’s fifth-biggest digital tech services exporter, behind global heavyweights such as India, the US, China and Germany, which sat in first, second, third and fourth place respectively. The UK’s impressive standing is largely owed to the number (7,497) of high-growth tech companies the nation is home to.
“The UK is Europe’s tech capital and these figures reinforce our industry’s reputation as a truly global player,” said Caroline Dinenage, minister of state for digital and culture.
“It’s great to see our digital exports booming, which will help create more jobs and opportunities for people up and down the country.
“We are investing heavily in the nation’s digital infrastructure as well as in people’s digital skills which puts British firms in an unparalleled position to seize new, global opportunities on the horizon.”
Last year, the UK’s trade surplus hit 55%, demonstrating that the value of the country’s exports is much higher than its imports. Comparatively, the average trade surplus from the world’s top 57 countries is 48%. This signals a 68% rise in the UK’s tech trade surplus over the last four years – from £8.7bn in 2015 to £12.8bn in 2019 – sitting just behind the insurance (£16.9bn) and financial services (£43.4bn) sectors.
The US was the biggest importer of tech services last year, valued at £34bn, followed closely by Germany at £33bn and then China at £21bn. India, Japan and Brazil harbour the biggest growth in imported tech services, surging by 29%, 24% and 17% respectively between 2018 and 2019.
“These factors give us a strong conviction that UK founders, government and industry leaders should all be gearing up to double tech exports by 2025, in the aftermath of the pandemic and Brexit” – Gerard Grech
Gerard Grech, CEO of Tech Nation, said: “The UK is a natural home for many scaling tech businesses, and there are a proportionally high number of scaling tech businesses located here that are already well-established in delivering domestic tech services. The UK is also third in the world for the number of tech unicorns, and number one in Europe. These factors give us a strong conviction that UK founders, government and industry leaders should all be gearing up to double tech exports by 2025, in the aftermath of both the pandemic and Brexit. By doubling exports, UK tech could contribute an additional £23bn to the economy per year by 2025 and move up the ranks to become a top global exporter of tech.”
On top of the report, Tech Nation produced the Global Opportunities Index, ranking the top 25 countries worldwide for promising tech business. Driven by factors like the rise of digital retail and e-commerce sales, the US and UK were ranked first and second in the index respectively.
Singapore and Brazil represent the fastest-growing global opportunities for trade, soaring five and 17 positions respectively in the country rankings for global opportunity in tech between 2019 and 2020. Post-Brexit, the UK should look towards the US, Israel, Canada, Germany and the Netherlands as the most profitable export markets.
The ranking uses metrics such as attractiveness in business terms, with an emphasis on digital products and services, as well as infrastructure, access to talent and education, ease of doing business, regulation, language and consumers.
Top digital tech trade opportunities by country 2020
|2020 Rank||Country||Change on 2019|
Source: StartupBlink, 2020
HM trade commissioner, Natalie Black CBE, commented: “Asia-Pacific is the growth opportunity for UK tech companies looking to expand overseas. it is great to see Australia, Singapore, Japan and South Korea all ranked in the top 25 countries on Tech Nation’s Global Opportunities Index. I look forward to working with Tech Nation through our Digital Trade Network to help more UK tech firms grow in this part of the world.”
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