PEER-TO-PEER business lending platform Growth Street has called on the government to offer more support for small- and medium-sized enterprises (SMEs), after a new survey found that business optimism is waning due to Brexit fears.
In the latest quarterly CBI SME Trends Survey, UK businesses reported that new order growth was stagnant in the three months to January, while 37 per cent of SMEs said that they felt less optimistic about their business situation in the months ahead.
Manufacturers and other exporters were particularly pessimistic about their export prospects for the year ahead. The index fell to -29 per cent during the quarter – the largest drop since April 2009.
These statistics have led to appeals for more government support for small businesses ahead of the UK’s imminent departure from the EU.
“With overwhelming uncertainty surrounding Brexit and our broader relationship with Europe, there is no doubt that SMEs in the UK are facing a number of challenges in 2019,” said Greg Carter, chief executive of Growth Street.
“The nature of our future trading relationship with the EU is as clear as mud, and the recent volatility in the value of the pound doesn’t make anything easier.
“However, the business owners we speak to each day are remarkably resilient and agile in their planning. One customer of Growth Street’s – a fashion wholesaler and distributor – has already set up a new warehouse arrangement in Amsterdam to protect their European operations, whether or not we reach a deal with the EU. Many businesses are already activating their contingency plans and are well prepared for 2019. Can we say the same about our politicians?
“It’s clear that Britain’s SMEs need strong support if Britain is going to continue to prosper through 2019 and beyond.”
The CBI echoed these views, stating that “it is crucial that politicians now work together to break the Brexit deadlock.”
“Uncertainty in the domestic and global trading environment is clearly hitting manufacturing SMEs hard, with sentiment falling, concerns over political and economic conditions abroad spiking and investment plans still well down on the past year,” said the CBI’s principal economist Alpesh Paleja.
“A deal is vital for the future health of SME manufacturers, giving them the confidence to invest, grow and compete on the global stage.”