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Institute of Export Newsletter January 2014







“Big Changes” Needed to Fix UK Export Performance, says Minister


UKTI Targeting 10,000 SME’s for personalised Export Support


China Takes Anti-Dumping Complaint to WTO


US Beef Ban to be lifted


Lack of Finance ‘Killing UK Export Drive’


EU Trade Agreement with Georgia


EU Reopens membership talks with Turkey








Chancellor’s Statement Helps Business to Make Export Waves


Britain’s Export Innovation and Creativity Showcased in National Competition


How the MINT Countries Ring in the New Year


CAFE Society (Contrived Acronyms For Exporters)




Foreword New Year wishes to everyone from the Institute of Export – we hope 2014 will be a successful, prosperous and productive year for you all. We start the New Year with a new Chair, Sir Eric Peacock, serial entrepreneur and non-executive director of both UK Export Finance and UK Trade & Investment, and six new Trustees and Directors Toufak Ahangari, Glenn Collins, Neil Hoskins, David Maisey, Simon Nicholson and Andrew Thorne. Over the last year the Institute has continued to forge powerful partnerships that further strengthen our position as a leader in providing the right training and qualifications to help businesses export more efficiently. The IOE’s new Diploma in World Customs Compliance and Regulation, designed with some of the world’s leading companies, including Nissan, was launched in September. The new Diploma demystifies the complexities of international compliance and customs procedures, equipping students with the knowledge to deal with competently in the UK, Europe – and across the world.

A dedicated team from the IOE included IOE Council member Sandra Strong and a steering group consisting of leading UK companies, Nissan; Sony; Amber Road; Adidas; BAE; BIS Export Controls; Ryan Consulting; Tesco; Grosvenor EU; Mike Hodge Associates and Barbara Scott Chair of The Customs Practitioners Group helped to design and drive through our latest qualification.

The Institute launched a new Certificate in International Trade for Insurance Brokers (CITIB) in consultation with the RWA Group, one of the largest UK compliance and training consultancies in the general insurance market. In November the unique Certified International Trade Advisor (CITA) qualification – accredited by the IOE as an Ofqual Awarding Organisation – was upgraded and improved. In 2013 the Institute announced that Association of Chartered Certified Accountants (ACCA) members who have passed the Diploma in Accounting and Business or Advanced Diploma in Accounting and Business ACCA qualifications can be fast-tracked into an International Trade qualification from the IOE. We also forged a dynamic new partnership with the powerful International Association for Contract Commercial Managers (IACCM) whose members are drawn from 152 countries and 11089 corporations across all industry sectors. We were proud to celebrate the success of Locunda Karam, CEO of Strategic Project Services Ltd based in Cape Town, South Africa, the first graduate of the IOE’s innovative two year Foundation Degree in Professional Practice of International Trade, developed in partnership with Anglia Ruskin University. In a first for the Institute, we partnered with Going Global, who hosted the UK’s largest national exhibition specifically aimed at helping businesses who are looking to expand in 2014 when we support the next Going Global event at Excel London on 15 – 16 May. Media interest in the work and views of the IOE continued unabated over the last 12 months with our director general Lesley Batchelor appearing on BBC Breakfast several times, as well as BBC Radio 5 Live, Radio 4 Today and the FT. You can keep up to date with our news and developments via our blog, or engage via Twitter with The Institute of Export and/or Lesley Batchelor. We look forward to hearing from you.

A message from the Director General The value and benefits of being a member of the Institute of Export in 2014 Lesley Batchelor, our Director General, outlines the business boosting benefits of being a member of the Institute of Export (IOE) in the year ahead. In 2014 what does being a member of the Institute of Export bring you and your business  Credibility  Knowledge  Profitability  Keeping up-to-date  Sustainability  Information 


 Competence Building on these in 2014, we are introducing some significant new steps forward The first major project for 2014 is to develop a Members Directory that will enable all our members to demonstrate their level of understanding and their skillset in international trade. This will be available after Easter and we would ask that all members take advantage of this opportunity to showcase their skills and also help our researchers as they compile the directory. The next major project is to provide more support for our members who want to meet and create branches across the country. This will be generated through our Council so please do get involved and engage with your local Council member – and if there isn’t one in your region please consider getting involved yourself. Information will be circulated regularly so watch out for ways to join in. Our lobbying work will gain momentum in 2014 with the Professionalism in International Trade concept being translated into telephone and email surveys of five questions each quarter. This will enable you all to have a voice in matters that face you as you trade internationally each day. More details of this will be sent to you in mid-February. And finally, our education and training programmes grow from strength to strength with our Diploma in World Customs Compliance and Regulation launched last quarter and a drive to take our programmes across the world into new markets. Being a part of this drive toward professionalism has never been more important and we need your views and ideas to make sure we always represent you appropriately and earnestly. The IOE is your professional body and we want you to use it and see it as a springboard for your own trading success. Good luck to all in 2014 – it’s going to be a great year for exporting! Lesley Batchelor - Director General

Editorial “Big Changes” Needed to Fix UK Export Performance, says Minister The government’s new Minister for Trade and Investment has warned that substantial improvements in export performance will be required to fix Britain’s balance of trade deficit problems, and is pressing for an urgent redoubling of efforts to get more British companies exporting. Lord Livingston, who caused considerable surprise by quitting as Chief Executive of British Telecom to take up the Ministerial role in December, already appears to be throwing down the gauntlet to effect major changes to target the government’s goal of £1Tn of exports annually by 2020. The government had anticipated that the 25% fall in the value of Sterling during the credit crisis would act as an immediate boost to export performance, but in reality the growth in British exports has been disappointing, and is certainly eclipsed by the much faster export growth achieved by Germany, Italy and Spain. The rate of growth in exports would now need to almost double for the remainder of the decade, if the government is to have any chance of reaching its target. Lord Livingston has accepted that there is no ‘silver bullet’ to achieve the target, but in a departure from his predecessor, Livingston is pressing for a greater target on medium sized businesses, rather than encouraging even the smallest businesses to export. “I think medium-sized firms have been lumped together usually with small companies and they are different,” said Lord Livingston. “There are about 10,000 medium-sized businesses in the UK, like the Mittelstand in Germany, and I think we should be having a real focus on helping them.” Lord Livingston was CEO of BT Group from 2008 until 2013. Having joined BT in 2002, he served on the BT Group Board as Group Finance Director and CEO BT Retail, its consumer and small business division. Prior to this, Lord Livingston was Group Finance Director at Dixons Group plc from the age of 32 making him the youngest FTSE 100 director by some distance. During his tenure, Dixons grew revenue and profits strongly and created the UK’s first major internet IPO, Freeserve. Lord Livingston has also worked for 3i plc, Bank of America and Arthur Andersen. He was previously a non-executive director of Hilton Group plc and is currently a non-executive director on the board of Celtic plc. He is a Chartered Accountant. He was born in Glasgow and has a wife and 2 children.

UKTI Targeting 10,000 SME’s for personalised Export Support International Business Times UK Trade and Investment will target thousands of SMEs directly and offer personalised support to help them export, said incoming trade minister Lord Livingston. There are 10,000 small firms across the country and UKTI "should be in personal contact with all of them so they actually know what we do and also to work out how we can help them," Livingston told the Daily Telegraph. "If they don't export, we will ask could they or should they be exporting, and if they do, then how can we help them export more," he said.

"We've got UKTI people around the world, so we can help them as they go into countries, introduce them to people, help fund trade shows and bring them on trade trips." Through its UK Export Finance department, the government has a number of initiatives to support SMEs looking to trade internationally, including the £1bn Direct Lending Scheme. However, the £5bn Export Refinancing Facility to support the finances of foreign importers of British goods has yet to launch, despite original plans for it to have been up and running by the end of 2012. It is being held up by legal work to get around European Union state aid law.

China Takes Anti-Dumping Complaint to WTO China has made a complaint against EU imposed anti-dumping duties. A ruling in 2011 found that EU duties on iron and steel screws and bolts were contrary to international rules, and gave the EU a timetable to comply with the rules by October 2012. The EU claims it has now complied with the requirements, but China says the calculations used are incorrect.

US Beef Ban to be lifted The US Department of Agriculture confirmed in November that the 15 year ban on beef from the EU would be lifted. The restriction will end 90 days after the legislation is published. The EU welcomed the move and expressed hope that the remaining bans on sheep and goat products would also be removed soon.

Lack of Finance ‘Killing UK Export Drive’ A joint report from CBI and BDO claims that medium sized businesses are not getting the support they need to export and invest abroad. The CBI claims that the economy could benefit by as much as £20 billion per year if access to the required finance could be unlocked. The report is particularly scathing about the UK Export Finance (UKEF) services, which it claims delivered support to just 52 small and medium sized enterprises in the last year. The join report calls for the number of companies supported to grow five-fold by making financial support more accessible. The report found that 69% of exporting SME’s were unaware of both UK Trade and Investment and UKEF. The report also hits out at bureaucracy and in particular the restrictions imposed by the Bribery Act.

EU Trade Agreement with Georgia The EU has successfully concluded a trade deal with Georgia. The Deep and comprehensive Free Trade Area (DCFTA) will enable Georgia to enjoy better access to EU markets for its goods and services through the EUR1 agreement. No date for implementation has yet been agreed.

EU Reopens membership talks with Turkey Turkey and the EU recommenced membership talks in November after a break of three years. Iceland and Macedonia are also seen as potential future members of the Union, with numerous other potential candidate countries, mostly from the former Yugoslavia and Soviet Union, also under consideration.


8 January 2014 - London The EIC: Finance for the Non-Finance Manager 15 January 2014 - Nottingham EMITA: Show off: polishing your pitch and running a stand without making an exhibition of yourself 15 February - 1 March 2014. UKTI East: Japan / South Korea Trade Mission

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IOE News Chancellor’s Statement Helps Business to Make Export Waves This development places the onus on smaller businesses that are potentially part of a supply chain to take the initiative and make sure that they are recognised by both UK Trade & Investment (UKTI) and the relevant industry bodies. It will also allow UK Export Finance to provide wider services within its ‘working capital product’ for smaller businesses. It must also put the onus on all businesses to look at why they are not exporting. With so much support available surely this is the time to look at the potential to export for every company. So why don’t they? Our latest survey with TAEFL stated that although nearly 1 in 2 companies reported that there were no issues preventing them from developing overseas markets. Of those that did report issues, 31% said that obtaining finance was a major consideration, with 27% reporting that it was hard to establish trustworthy contacts overseas – a challenge which was also hindering their development into these markets. Twenty three per cent highlighted that red tape, such as export legislation in the buyers’ country, was preventing them from developing markets, 18% said that a lack of knowledge of exporting was holding them back – and 11% did not know who to speak to. Putting it crudely we need to ‘get our act together’ or we will lose opportunities to other better informed companies – and they may not be British. One of the main things holding British business back isn’t lack of finance (although it is a contributing factor once the export opportunity has been found). A lack of curiosity is preventing us from finding out how to trade internationally properly. Looking at the big picture is great but once a trade has been agreed the detail is still a priority if a profit is to be made. Businesses should not need Government help to enter a new market. Entry should be a simple extension to the marketing activity that they naturally start to seek out new markets and a wider audience for their goods. Let’s educate our young people to ensure that they know what steps need to be taken to look further than our own back garden. The Institute runs a very good helpline to assist in the detail – however the planning should be down to the business. To reach an export market other than Europe a company should factor in the following:  Detailed research about the market regulation in terms of the product offered i.e. electronic certification; packaging requirements; language requirements; marketing restrictions; market research with regard to acceptability of product; taxes that might be attracted by your product; sales channels i.e. distribution/agency - legal aspects of the sales and Intellectual Property must be considered and any licensing must be able to work and collect monies easily; what is the best price and how will the business get paid and cover any risks if necessary?  Flying out to an exhibition ideally as a visitor to WALK the show and find out how that market operates UKTI a Trade Access Programme see UKTI website.  Establish a list of contacts from UKTI and, having understood who the company is targeting, buy a list of contacts generated by the excellent embassies and high commissions around the world.  Establish a plan internally and obtain board level commitment to international trade.

 Visit the new markets – enlist the support of UKTI who can sort out an itinerary. Arrange meetings and, where needed, brief an interpreter to work with the business for the duration of the visit.  When back in the UK the business should be making arrangements to move forward and to establish a launch of some sort. This launch needs planning and a budget is required to ensure that the marketing is correct and that it is not just a ‘wet weekend’ launch.  The process outlined above should involve around 4-5 visits from start to launch – visas and flights hotels and subsistence are all part of this investment and should be included in the refunds.  The entire process requires a budget which should be treated as an investment, spending money in the UK on sales and marketing is not different to spending money to develop a new market. It needs to be part of a full programme of activity, exporting is not an add on – it is an integral part of the Business Plan and needs to be treated with commitment to make it work. There is an argument that the OMIS (as in France) should only be charged once the sales have started – but that might be going too far! It could be linked to the Targeted Export Support Scheme. The Institute of Export is here to help your businesses make a profit out of your new market call us on 01733 404400

Britain’s Export Innovation and Creativity Showcased in National Competition The Institute of Export (IOE) is marking the vibrant success of five businesses who clinched top spot in a nationwide competition to accelerate and boost their export growth. Our Director General Lesley Batchelor was on the judging panel of the first ever Global Jump-start Competition launched by Open to Export – a free online community spearheaded by UK Trade & Investment in partnership with the private sector. Matthew Halfin, Marketing Manager for Open to Export, said: “We were blown-away by the quality of the entries we received, especially the ones from our finalists and we are very excited to be supporting them as they realise their international growth ambitions.” A big congratulations to the five finalists starting with Blooming Simple whose flat-packed flower vase is being sold into international markets. Mia Tui, who invented her award winning bag design while living in Vietnam, has since created a range of practical handbags with pockets for everything. Ohh Deer, a group of illustrators designing gifts and clothing, have seen revenues grow exponentially in a year and are now selling products to Urban Outfitters, Paperchase and Topshop. Global Jump-start winners (L-R): See.Sense., MiaTui, Ohh Deer, Olympus Automation, Blooming Simple

Revolutionary industrial cooking technology from Olympus Automation reduces salt content in processed foods by 20% – while husband and wife team See.Sense created the first intelligent cycle light that flashes brighter and faster in response to road risks.

Trade and Investment Minister, Lord Livingston, said: “There is no doubt that Britain has the creativity and innovation it needs to compete on the world stage and this competition demonstrates the quality of the UK’s small businesses which are driving our economy forward. I congratulate the winning companies on their success and look forward to seeing them realise their export potential.” The winning companies will receive an Institute of Export training course and one year’s Business Membership worth over £400, a return flight including all charges to any easyJet destination, an Export Communications Review from UK Trade & Investment (UKTI) worth £250, a one year subscription to Croner-i International Trade export legislation guide worth £1000 – and £2,000 worth of business planning support from an expert accountant from the Association of Chartered Certified Accountants (ACCA). Lesley added: “The vision, talent and potential of the winners shone through and, with support from the aforementioned companies and the IOE – whose commitment is to embed professionalism into international trade – we wish the winners every success as they harness the wealth of opportunities in exporting and international trade.” Fellow judges were Nicola Bridgett, Senior International Trade Advisor for UK Trade & Investment (UKTI), Ali Gayward, UK Commercial Manager for easyJet and Paul Lewis, marketing director of

How the MINT Countries Ring in the New Year The term MINT (also formerly known as MIKT or MIST) refers to the economies of Mexico, Indonesia, Nigeria, and Turkey. As 2014 approaches, the Institute of Export looks at how the MINT markets will celebrate New Year. Mexico On New Year’s Eve Mexicans enjoy a late-night dinner with their families, the traditional meal being turkey and mole (a chilli-based sauce). As the clock chimes midnight, they will eat a grape with each of the twelve chimes while making a wish with each one. Homes are decorated in in colours that represent their hopes for improvements in the upcoming year: red for lifestyle and love, yellow for employment, green for finances and white for health. Another tradition is to make a list of all the bad or unhappy events over the past 12 months; before midnight, this list is thrown into a fire, symbolizing the removal of negative energy before the start of the coming year. Indonesia Hotels, discos and major restaurants in Indonesia offer special meals, entertainment and dancing as Indonesians celebrate New Year’s Eve with revelry throughout urban areas, partying with their families, siblings, and friends. Trumpets and fireworks are viewed as important elements of the evening and many people take part in a city convoy of cars and motorcycles.

Nigeria Here many people observe New Year’s Eve by going to Church, while others head to nightclubs, and parties organised by individuals, communities and even the Lagos State government, which runs Africa’s biggest New Year’s event, the Lagos Countdown.

Held in the Eko Atlantic City, this spectacular event was created to boost tourism, making Lagos a premium destination for business and leisure. Kicking in December and lasting till the 1st of January, it is attended by around 100,000 people and attracts thousands of domestic and foreign tourists who are entertained every evening by different artists. Turkey In Turkey, Santa Claus is associated with New Year’s Eve instead of Christmas, so even though Turkish people generally don’t celebrate Christmas, decorating Christmas trees is a very popular tradition on New Year’s Eve. Other decorations and customs, traditionally associated with Christmas and other national festivals, are part of various celebrations. Homes and streets feature twinkling lights, small gifts are exchanged and large meals are organised with family and friends. Large public and private parties are organised in cities and towns, featuring dancing, concerts, laser and lightshows as well as the traditional countdown to midnight and fireworks display. Wherever you are in the world, our team at the Institute of Export wishes you a very Happy New Year.

CAFE Society (Contrived Acronyms For Exporters) We are continuing with our export acronyms with help from Catriona Tippin, who runs a proofreading service Proofreading Tips and is also a writer and illustrator of children’s books. Catriona has looked beyond the well-known BRIC (Brazil, Russia, India and China) coined by Goldman Sachs economist Jim O’Neill in 2001 to present her CAFE Society (Contrived Acronyms For Exporters) – a veritable seasonal selection of acronyms that could be tripping off our tongues in 2014. BRIC – Brazil, Russia, India, China Which grew into BRICS – with the addition of South Africa and evolved into BICIS – with the subtraction of Russia and the addition of Indonesia Or there’s IBSA – India, Brazil, South Africa which acquired BASIC – Brazil, South Africa, India and China Then we have the possibly controversial PIGS – Portugal, Italy, Greece, Spain or PIIGS – Portugal, Italy, Ireland, Greece, Spain And facing different difficulties there’s

CARBS - Canada. Australia, Russia, Brazil, South Africa

JIB – Japan, Israel, Britain unlike CASSH – Canada, Australia, Singapore. Switzerland, Hong Kong Something we may all have overdosed on this holiday is CARBS – Canada. Australia, Russia, Brazil, South Africa Then we heard about the potential in VISTA – Vietnam, Indonesia, South Africa, Turkey, Argentina But what about CIVETS – Colombia, Indonesia, Vietnam, Egypt, Turkey, South Africa ….. we thought it was an animal known for its scent glands! So to stave off acronym indigestion maybe we should just have a MINT – Mexico, Indonesia, Nigeria, Turkey Finally, how about some sympathy for CEMENT – Countries in Emerging Markets Excluded by New Terminology! So whether you are in a JIB or feeling full in CARBS we’d like to wish you a very happy holiday from the Institute of Export. Catriona Tippin has been a member of the Society of Children’s Book Writers and Illustrators (SCBWI) since 2006 and proofreads study guides, house magazines and publicity material for two national educational charities, in addition to working on a variety of proofreads and copyedits for the growing self-published world.

And finally .... Fun Facts! Did you know.......      

Fossilized bird droppings are one of the chief exports of Nauru, an island nation in the Western Pacific In 1952, the first TV toy commercial aired. It was for Mr. Potato Head The most overdue book in the world was borrowed from Sidney Sussex College in Cambridge, England and was returned 288 years later Montreal has an underground city, which has over 2,000 shops and 26 kilometres of walkways. This is the largest underground network for any city People drank gold powder mixed in with water in medieval Europe to relieve pain from sore limbs More than three thousand people work on research in Antarctica each year

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