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Low-carbon SMEs lead UK exports

New research indicates that the UK could triple its exports of low-carbon goods and services by 2020 if small to medium enterprises (SMEs) in the UK were given greater assistance.

A new report from the Carbon Trust says the current £12bn value of low-carbon exports could rise to £30bn by 2020.

Researchers took evidence from more than 180 SMEs and interviewed government and industry experts. They found that low-carbon SMEs were more than twice as likely to export (45%) than SMEs in other sectors and 67% of them were already selling to emerging economies.

The report identifies a £15bn annual opportunity in the so-called ‘MUST’ markets - Mexico, the UAE, South Africa, and Turkey. The quartet are seen as sharing favourable business environments, including supportive regulatory systems and a strong demand for low-carbon goods and services.

But SMEs in the low-carbon sector are said to face tougher barriers than peers in other sectors, with nearly one in four complaining that raising capital was the primary barrier to exporting.

The report calls for coordinated action in three areas:

  • UK Government to redirect some existing financial support to business to bolster risk capital for low-carbon SMEs;
  • UK Trade & Investment, UK Export Finance, and the Foreign Commonwealth Office to provide a more integrated service for low-carbon SMEs;
  • SMEs to make full use of existing support structures to help them succeed in overseas markets.

The study was commissioned by Shell Springfield, which backs SMEs to develop innovative, low-carbon business ideas. Over the past nine years, it has awarded £3m to 80 UK companies.

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