These are interesting times for UK businesses interested in exporting. On Tuesday, the same day that David Cameron fired his first shots across the bow of the European Union, I had the privilege to attend a round-table with Christopher Prentice, the UK ambassador to Italy (and, as he reminded us, San Marino).
He was back from Italy to support Export Week and, in particular, the UKTI’s largest ever ad campaign to persuade homegrown businesses that #exportingisgreat.
Under the message that companies who export tend to experience 37 percent faster growth, the UKTI is aiming to hit a target of Â£1 trillion in UK exports by 2020.
So it was that the UKTI East Midlands and the Notts/Derbys branch of the Federation of Small Businesses, invited a number of companies for a chat with the ambassador.
Christopher Prentice confirmed that, today, commercial lobbying takes up far more of embassy time than, say 20-30 years ago. While his 150-strong team in Italy includes experts on every political arena you’d expect, from defence to crime, he has a sizeable number of embassy staff looking at trade, and helping to forge ties for UK inward investment into Italy.
And, obviously, this pattern will be repeated in nations across the world.
Italy seems to be a fascinating test case in modern business. After two decades dominated by Silvio Berlusconi, Italy is now 18 months into the premiership of Matteo Renzi, who is, as Prentice put it ‘changing the weather.’
Renzi is determined to make Italy a powerhouse and has implemented significant structural reforms, affecting areas such as employment law to create a more flexible labour market.
The result is that, from the point 5 or so years ago when Italy was deemed one of the Eurozone’s biggest risks, today it is a major player with projected 1 percent growth in 2016.
Prentice said he was confident that EU negotiations would pay off to enable further potential for UK exports into Italy; indeed, throughout the event he was on standby to patch a call through from Cameron to Renzi.
Interestingly, given Britain’s current talk of devolution in Scotland and the Northern Powerhouse, Rome is currently reversing that trend, in order to be able to override regions on areas of national strategic importance.
On the other hand, Italy is a large country; did you know that Milan is closer to London than Palermo? Given how much of the nation’s industry is situated around Milan and Turin, Northern Italian business often has stronger ties to middle-European neighbours in France and German than fellow countrymen in the South.
From a practical viewpoint, Prentice’s insight was invaluable in revealing the extent to which the Foreign Office can assist British businesses with export opportunities, be it the commissioning of ground-level exploratory research into particular sectors or regions, to direct political engagement. (And Italy, Prentice remarked, is a country that maintains respect for ambassadorial privilege; an enquiry will be listened to.)
One area where the UK is working to improve business relations is by trialling prompt payment cultures, to overcome a historic gap between the wildly differing expectations of British businesses from their Italian counterparts.
Given the opportunity to ask specific questions, I broached the subject of assistance in finding the best route to market, whether through existing local agents or distributors, or when it becomes more opportune to set up a direct subsidiary.
It was host Ian Harrison, Regional Director, East Midlands for the UKTI, rather than Prentice, who provided the answer. He confirmed that, in addition to embassy assistance, the British Chamber of Commerce perhaps offers the best practical route to local knowledge. They have an office in Milan and are soon to open one in Rome.
At the same time, UKTI operates the Overseas Business Network, effectively, a group of ex-pat businessman offering real-world experience of particular nations and markets in addition to official political channels.
With all of these opportunities, Prentice concluded, there is no reason why UK businesses shouldn’t be turning to export to drive growth: bread, butter, jam & double cream, as he put it.
He shared statistics from his office confirming that the key sectors for UK opportunities into Italy are:
- Consumer & retail
- Defence & security
- Financial services
- Food & drink
- Life sciences
- Marine & port
- Smart future cities
Meanwhile, Harrison pointed out that the new Exportingisgreat website contains a database of live tenders, globally, that might provide export opportunities for British businesses.
As I said at the start of this post, interesting times.
Thanks to Christopher Prentice, the UKTI and the Federation of Small Businesses for the invitation to this event.