Chamber News

Join BritCham Philippines on 29 January 2016, 10.30am (BST) for a free webinar on the power and energy sector in the Philippines. Get an overview of the sector and find out the different business opportunities available to you.

Speakers are from the Department of Energy and from the private secotr to present the challenges, opportunities, growth potential and how foreign companies can be involved. A Q&A will follow to answer any queries.

Registration for this event is on or before25 January 2016click here to register.

If you require further information please e-mail uksme@britcham.org.ph

On 8-9 March 2016, BritCham Philippines will also be organisinga Trade Mission on Power/ Energy and Infrastructure Sectors. Please email Rona Diaz if you’re interested to join: rdiaz@britcham.org.ph

Monthly Headlines:

• Q3 UK GDP growth revised downwards with slower than expected service sector growth
• The Q4 2015 QES signals slower near-term growth for the UK economy
• US raises interest rates as monetary policy loosens further in the Eurozone

The latest review (based on December 2015 data releases) shows that UK economic growth has been revised downwards from 0.5% to 0.4%. This downward revision was driven partly by the service sector growing more slowly than expected.

The UK labour market remains a key area of strength, with unemployment falling. Despite wages rising faster than prices, total pay growth slowed.

The UK trade deficit widened to £14.1 billion from £9.7 billion. The widening deficit was driven by a fall in exports and a rise in imports. This deterioration is mirrored in the latest QES resultsfor Q4 2015,where Norfolk’s manufacturers export sales balances fell to its lowest level since Q3 2009.

Interest rates in the US, the world’s largest economy were increased for the first time since 2006. The rates move reflected the improving outlook for the US economy. In contrast the European Central Bank further loosened monetary policy within the Eurozone and extended its monthly €60 billion stimulus programme. Whilst the Bank of England kept UK interest rates on hold at 0.5%.

Overall, last month’s data releases provides evidence that although the economic outlook for the UK remains broadly positive, there are mounting headwinds facing the UK economy. To read the full report click here.

• The BCC’s economic survey for Q4 2015 signals slower economic growth in the short term.
• Most key balances for both manufacturing and services are down on the previous quarter
• Manufacturing export sales balances fall to levels approaching stagnation in Q4 – the lowest since 2009

The British Chambers of Commerce (BCC) Quarterly Economic Survey – Britain’s largest and most authoritative private sector business survey, based on almost 7,500 responses from firms – shows that most key manufacturing and services balances were weaker this quarter, but manufacturing firms fared far worse. This has led Britain’s two-tier growth trend to become further entrenched.

Most key balances for the Norfolk services sector dipped slightly again on the previous quarter, with domestic sales continuing to be the main contributor to overall growth. The sector however continues to remain resilient in the face of global headwinds. However the Norfolk manufacturing sector continues to struggle. Domestic and export sales and order balances have now fallen well below their pre-recession levels in 2007, suggesting that the sector is close to stagnation.

Key Norfolk findings in the Q4 2015 Quarterly Economic Survey:

• Overall, the results suggest positive economic growth over the next year, albeit at a slower pace, but built mainly off the back of the services sector. The UK recovery continues to face many global challenges
• Most key balances were weaker in Q4 than in Q3 for both the manufacturing and services sectors; the falls in services are in general smaller than the declines in manufacturing
• Norfolk export manufacturing balances declined sharply to levels approaching stagnation – export sales declined three points to -3%, the lowest level since Q3 2009 – while export orders also fell drastically to -8%
• The Norfolk services sector export sales balance, whilst still in negative territory, rose from -4% to -3%
• Norfolk’s domestic balances were stronger than export balances, despite falling. Norfolk manufacturing sales balance fell fourteen points to -8%, while domestic orders were down three points to -5%. In services, domestic sales balance fell three points to +26%, with orders dropping ten points to +11%
• Intentions to increase prices rose in manufacturing, from +21% in Q3 to +23% in Q4. In services however, this fell by two points to +22%
• Both sectors report increased pressures for higher pay settlements. Norfolk manufacturers in particular recorded a marked increase from +15% in Q3 to +30% in Q4.

Caroline Williams, Chief Executive, Norfolk Chamber said:

“2015 has been a tough year for the manufacturing sector, who have found it challenging in terms of UK and export sales. Although, the service sector continued to produce robust figures throughout the year, they too finished with lower results than at the start of the year.

However Norfolk is still a great place to be in business. It is important that the Norfolk business community holds its nerve during these challenging times to retain the confidence in both their customers and their staff. The Norfolk economy is mixed with some business doing really well, as our export documentation department’s activity confirms. Accessing global markets can expand opportunities for both service and manufacturing businesses can create great opportunities.

As we all know it is our people who really make a difference in our businesses so at the start of the New Year it is important that we do all we can to both retain and develop our staff. It is their innovation and new ideas which will help move the business forward and if it can include developing Norfolk’s younger people so much the better.

Finally it is important to get out there and network. Find out what your competitors are doing, what your customers are looking for, what new opportunities are out there for your business, and what support is available. It is often the case that another business person has the answer to your challenge so do take time to get out and about”

John Longworth, Director General of the British Chambers of Commerce, said:

“While these latest figures demonstrate growth, it is clear that there are warning signs of potential trouble ahead. The declines across the board should send a message to government that UK firms are in desperate need of a favourable business environment, not more administrative burdens.

“It is not enough to rely upon consumer spending and the housing market to grow the economy, nor to rely purely on services to drive export growth. We need a rebalanced economy if we are to continue punching above our weight on the global stage. The quality and variety of our goods and services is what gives Brand Britain its strength overseas.

“The vast windfall from the OBR in the Autumn Statement led to revised forecasts based on improving tax receipts. However businesses can’t focus on growing amid a storm of red tape and tax compliance burdens. In addition, government policy has created overwhelming pressure to increase pay settlements, despite downward pressure on wages created by continued migration to the UK. Businesses are finding themselves chafed and stagnating.

“The real concern is that this period of two-tier growth becomes the norm rather than a blip. This requires the government to make 2016 a year of action, on infrastructure, skills, and access to non-equity finance for firms. Otherwise the UK economy could suffer negative consequences in the face of increasing global uncertainty.”

David Kern, Chief Economist at the British Chambers of Commerce, added:

“Coming after relatively weak figures in our Q3 survey, the falling balances in Q4 highlight the risk that the pace of growth may slow further. The results also underscore the serious obstacles that the UK will face when trying to rebalance the economy towards net exports. While worsening global circumstances are the main impediment, we are not doing enough closer to home to encourage businesses to trade overseas.

“The sharp decline in export manufacturing balances, to levels approaching stagnation, is particularly disturbing. Slowing growth in international markets is causing these firms to become pessimistic about their short-term prospects.

“Though our vibrant and resilient services sector will remain the main UK growth driver, the Q4 results indicate that it is also losing some of its momentum. But the challenges facing manufacturing are much more serious.

“While we must not forget the strengths of the UK economy – with higher growth than in most G7 economies and with a dynamic and flexible labour market – the recovery is still fragile. Given the global uncertainties, it is important to avoid unnecessary risks. Though wage pressures are rising, inflation is likely to remain below target over the next 18 months, and the MPC should keep interest rates at their current low levels for the time being.”

January 2016 signals the start of Chamber’s 120th anniversary year. In order to commemorate 120 years since incorporation, Chamber tasked research assistant Adam Dean, hired through the UEA’s Undergraduate and Graduate Internship Programme, with the vast assignment of unearthing highlights from 120 years of detailed history taken from a huge range of archives. Starting his work in 2015 Adam spent nearly 3 months tirelessly reading through over a century’s worth of meeting notes, press cuttings and articles to discover the changing face of the Chamber and Norfolk business.

The central factor in this work has been exploring the ‘then and now’ aspect of the last 120 years and the legacy Chamber, and its Norfolk business members, have created. The research has uncovered Chamber’s rich history reinforced by the invariable affiliation to the county’s distinguished business leaders. Notable figures, including Jeremiah James Colman, proved key in the formative years of the Chamber.

To commemorate 120 years Chamber have launched a dedicated area on our website: www.norfolkchamber.co.uk/120th to share the research undertaken. This is sectioned into key areas including; Past President’s from 1896 to present; an area looking at the key industry sectors for our region; and a chance to find out more about the upcoming events happening throughout the celebratory anniversary year.

In addition, Chamber is proud to launch their Chamber Community Fund as part of an ongoing campaign encouraging the growth and advancement of Norfolk’s young people. Chamber will match pound-for-pound every donation made up to £10,000 with the goal being to meet this target within 12 months. Grants will be made to suitable community projects towards the end of 2016. The purpose of this fund is to create opportunities for the younger generation and help them flourish in employment.

Caroline Williams, Chief Executive of Chamber, comments:

“We are thrilled to have hit such a milestone. In order to gain a better understanding of the Chamber we have been exploring the history of the organisation. In doing so we have unearthed a greater knowledge and understanding of Chamber and the people who have been part of the network in the past.

“However, as usual, the Chamber is looking forward. With the help and support of our members we are looking, as a key focus for 2016, to create opportunities for Norfolk’s younger generation and help them discover their full potential”

The Norfolk Chamber is keen to hear of any of their members is celebrating a long-standing anniversary or if you have archives, images that could support the 120th anniversary celebration. To submit your story or any images, or if you have any questions, please email: 120years@norfolkchamber.co.uk

If the UK leaves the EU without putting a new Free Trade Agreement (FTA) in place, British exporters could suffer significant losses according to a report from trade credit insurance provider Euler Hermes.

The warning comes as David Cameron enters the latest phase of his EU reform negotiations.

There is currently no indication of whether any deal achieved by the Prime Minister would be sufficient to satisfy those in his own party and elsewhere who want Britain to exit the EU – the so-called Brexit option.

In that context, the report Brexit me if you can (available at www.eulerhermes.com) considers the impacts of three scenarios on UK firms.

In the first, the UK stays in the EU, disruption to trade is minimised and exports continue to grow by as much as £26 billion by 2019. Turnover of UK firms would, it is suggested, grow by 4% on average after 2017.

The second option considered is for the UK to leave the EU and to conclude an FTA with the Union as well as bilateral agreements with non-EU countries. This option would see turnover grow at 2%.

In the third scenario, Brexit happens without a UK-EU FTA being agreed. This could result in losses of up to £30 billion or 8% of UK total goods exports, Euler Hermes warns.

Even when offset by trade with Commonwealth countries, the gap would take at least a decade to fill, its report argues. Under this worst case scenario, the trade balance deficit would quickly widen by £35 billion and turnover for British firms would contract by an average – 1% per year.

As Ana Boata of Euler Hermes said: “Our forecasts paint a dismal picture for British businesses in a world outside of the EU.”

Commenting ahead of the EU Summit – the first since the Prime Minister formally announced his areas of negotiation, John Longworth, BCC Director General, said:

“Our survey work has shown that many business leaders are judging the EU referendum debate on the results the Prime Minister delivers.

“This EU Summit may prove a tipping point. Clarity on safeguards, sovereignty, a better single market and a balanced approach to migration are urgently required – so that businesspeople and the UK public can make up their minds.”

• In the three months from August-October 2015, employment was up 207,000 and unemployment was 110,000 lower

• The youth unemployment rate fell to its lowest level for more than 10 years

• Annual growth in average earnings in the three months from August-October fell to 2.4% including bonuses and 2.0% excluding bonuses

Commenting on the labour market figures for December 2015, published today by the ONS, David Kern, BCC Chief Economist, said:

“This is an encouraging pre-Christmas set of figures, with employment rising to a record high, unemployment falling, and inactivity declining. The youth unemployment rate has also fallen to a 10-year low, although it is still considerably higher than the national average. Overall these figures demonstrate that our flexible and vibrant labour market remains a source of strength for the UK economy.

“While wages are continuing to rise faster than prices, boosting disposable incomes, the slowdown in annual earnings growth will provide more evidence to the MPC that there is no need to consider any early increase in interest rates.”

The majority of companies across Norfolk and Suffolk back proposals to devolve more powers from central government to cities and regions saying the move would boost confidence and give local businesses a stronger voice, according to new research from financial and business advisers Grant Thornton.

The survey results found nearly 60% of businesses questioned support the idea of devolution with almost half of respondents (42%) feeling devolution would be best achieved jointly by Norfolk and Suffolk rather than individually or with Cambridgeshire or Essex.

The survey asked a range of businesses from across the two counties for their views, including members of the areas Chambers of Commerce.

“Devolution remains a political priority and in both Norfolk and Suffolk, the survey findings suggest substantial business support for the idea. Grant Thornton has also carried out national research*on the topic of devolution which notes that generally, local government are also very positive about making further devolution happen.” said Toby Wilson of Grant Thornton’s Norwich office. “However, it will be up to local authorities and related partners to continue to show they are prepared to make tough decisions regarding scarce resources. They also need to show that these decisions are informed by economic necessity and the best long-term outcomes for the whole area, not temporary local political accommodation.”

When asked about the main reasons for supporting greater devolution, more than two thirds (67%) said it would give businesses more certainty over long term projects such as transport infrastructure, planning and skills provision. A further 64% said devolution would provide local companies with a greater say over key areas including business support and skills, while 36% said it would boost productivity and economic growth.

The findings follow George Osborne’s ‘devolution revolution’ announcement made last month which included plans to scrap the uniform business rate set in Whitehall and give local councils control to set the levy.

The survey results also found that nearly 60% thought greater devolution would motivate them to be more proactive in local decision making and 20% of local firms said it would give them more confidence to employ more staff.

“Devolution offers us an exciting opportunity to release even more of the entrepreneurship, innovation and ideas that drive our local economy.” said Mark Pendlington, chairman of New Anglia LEP. “Our businesses across Norfolk and Suffolk are at the heart of these ambitions, but we know they want more clarity and certainty over key areas such as long-term funding for infrastructure, skills and business funding and support. Our job as a LEP is to ensure those asks are taken and heard in Westminster as we continue our discussions on devolution locally and with Government.”

When asked if a unifying brand would benefit both counties, such as the “Northern Powerhouse” 42% said it would be beneficial, with 81% saying this would provide greater recognition for inward investment across the UK and globally and 55% saying the region has great assets that need exploiting. However, more than half (52%) said there would be no value in electing a regional Mayor to be responsible for the devolved powers.

“The Norfolk business community welcome the opportunities that the Norfolk and Suffolk Devolution proposal could bring to our region.” said Jonathan Cage, President of Norfolk Chamber of Commerce. “The benefits of having greater local decision making and the ability to influence further economic growth and productivity are clear. The Chamber will be working in close partnership with our local authorities to ensure that the Devolution proposal moves forward swiftly. We will ensure that the local business voice is heard and will help support the Combined Authority in their efforts to help deliver greater economic growth and jobs.”

“The Norfolk and Suffolk devolution proposals, such as infrastructure, economic development and skills are in important service delivery areas that are very relevant to our members and to the wider business community.” said Sarah Howard, President of Suffolk Chamber of Commerce. “We very much welcome the ambition to make associated investment decisions ‘closer to home’ and we will be working with our partners to ensure that the proposals are progressed quickly and that there is a strong voice for business aligned to the efforts of the Combined Authority.”

*Research conducted by Grant Thornton and think-tank Localis. Click here to download a full copy of the Making Devolution Work report

UKTI’s Franco-British Offshore Wind and Tidal event at the British Ambassador’s Residence in Paris has been confirmed for Tuesday 26 January 2016. The format will be similar to last year; although UKTI are planning to allow more time for the one-to-one meetings with your French prospects. (That’s why the actual programme is still to be confirmed). As before, UKTI’s Alan Highet will attend to support East of England delegates, by helping you to get as much benefit as possible out of your participation …

Register promptly to be profiled in a catalogue of UK participants, that will be sent to all the participating French companies so they can request meetings. UK companies that have registered in time to feature in the catalogue will receive the equivalent catalogue of French participants, so you can request meetings with them.

Indeed, if you know already that there are French companies you’d like to meet, let Alan Highet know now at alan.highet@mobile.ukti.gov.uk. If you don’t know Alan Highet already, he’s UKTI’s lead advisor for Environmental & Energy in the East of England. It’s likely the companies you’ll want to meet will attend anyway, as this is recognised in France as one of the major OWE events, but just in case they might not have done so already, Alan’s colleagues in Paris will call them to encourage their participation … . UKTI might not be able to guarantee it, but they’ll do their best to get you that meeting!

It really is an appropriate time to meet French companies associated with developing their emerging OWE market; the prestigious surroundings of HM Ambassador’s Residence near the Élysée Palace helps to attract important buyers and influencers; and UKTI is collaborating once again with the French renewables industry organisation Syndicat des Energies Renouvelables (SER) and others – so you’ll have access to France’s key industry players. What’s more, UKTI are hoping to arrange a “return” event later in 2016, exclusive to the East of England, inviting French companies who have met East of England companies in Paris to visit our region so they can witness your capabilities at first hand …

The closing date for registrations that’s on 28 December, for entry in the catalogue that will be sent to French companies so they can request meetings with you. As that’s in the middle of the Festive Season, and there won’t be time after the New Year to include companies who haven’t already registered, UKTI recommend registering as soon as possible to ensure your inclusion well before Christmas! The participation fee is £420 that allows representation by two delegates per company. Last time East of England companies averaged more than 6 meetings per company, and it’s quite common for French companies to agree to a follow-up meeting soon afterwards, while you might still be in Paris!

SMEs that meet the qualifying criteria can apply for £200 towards travel costs associated with attending this event (also subject to budget availability at the time of your application, so don’t delay!)

If you register on-line now, please email alan.highet@mobile.ukti.gov.uk, to let him know, so that he can alert his colleagues in Paris and to highlight your participation. If you want to register but it’s not convenient to do so on-line right now, you can email alan.highet@mobile.ukti.gov.uk, sending the message – “Yes, please book my place at the British Embassy in Paris, 26 January 2016” – and Alan will let his colleagues know. You’ll still need to register on-line before the deadline for inclusion in the catalogue, but at least UKTI will have noted your interest and send you reminders if necessary!

Your commitment to attend and settle the participation fee, via UKTI’s OMIS system (Overseas Market Introduction Service), will follow. On-line registration is being organised for UKTI by Proximum Group, then UKTI will assist you locally with the OMIS admin.

The OMIS fee for participation on 26 January is set again at UKTI’s minimum level (£420 + vat) for up to two delegates to attend. That reflects a significant subsidy against the actual costs of facilitating your series of business meetings. During the day you’ll also find out what’s up-to-date in the French sector, and there are several networking opportunities to meet others with whom you might not have pre-arranged meetings – particularly over coffee, lunch and between your meetings; and previously there has been an end-of-event reception.

Please click here to register

Commenting on the latest delay to a government decision on a new runway in the South East, John Longworth, BCC Director General, said:

“Businesses will see this as a gutless move by a government that promised a clear decision on a new runway by the end of the year.

“Business will question whether ministers are delaying critical upgrades to our national infrastructure for legitimate reasons, or to satisfy short-term political interests.

“Businesses across Britain will be asking whether there is any point in setting up an Airports Commission – or the recently-announced National Infrastructure Commission – if political considerations are always going to trump big decisions in the national interest.

“The Commission has said that a new runway should be built at Heathrow, and quickly. Expansion at other airports is needed too.Ministers need to stop prevaricating and get on with doing what the country sorely needs.”

Over 80 members joined us armed with Christmas sweaters for a morning of festive fun at Sprowston Manor at our annual Norwich Christmas Breakfast.

We had a variety of Christmas themed networking activities, including a Two Truths, One Lie activity which involved delegates announcing the worst of their Christmas present history. Delegates also had the opportunity to draw and listen to their favourite Christmas songs in other ice breakers.

Featured charity Break were very grateful for the huge amount of donated gifts and food from delegates that they will include in their Christmas drop off to those in need of a little festive magic this year.

Motorists are warned of overnight restrictions and closures as the major works at the A47 Postwick junction near completion. These restrictions will mainly affect eastbound traffic.

For the next three nights, Wednesday 9 December to Friday 11 December (8pm to no later than 6am) there will be eastbound lane closures on the A47 and the full closure of the new slip road, with traffic diverted around the A47 Cucumber Lane roundabout and back to the Postwick junction via the westbound A47.

These restrictions are to allow surfacing, white lining and the installation of new signs to complete the tie-in of the new slip road with the main eastbound carriageway.

A47 eastbound overnight closure

Next week, the A47 eastbound will be closed overnight (8pm to no later than 6am) on Monday 14 December for completion of the new slip road and removal of traffic management from the main A47. (Tuesday 15th and/or Wednesday 16th may be used if completion that night is not possible).

The signed diversion route will be via the A146 from Trowse, the A143 and A12, re-joining the A47 at Vauxhall roundabout, Great Yarmouth. The closures are taking place overnight to avoid peak daytime traffic.