UK imports drop by £61.0bn and exports by £32.8bn through 2023
Analysis of trade data from global financial services firm Ebury reveals that UK trade continues to underperform with 2023 recording sizeable drops in both imports and exports as global economic and geopolitical uncertainty persists.
Changes in UK trade: 2022 v 2023
The total value of goods imported to the UK dropped by a significant £61.0bn in 2023 from 2022 levels.
This was in large part due to the decreased value and volume of LNG imports from countries outside the EU like the US and Qatar as Western Europe recovered from the energy shock following Russia’s invasion of Ukraine.
As a consequence, there was a 22% drop in non-EU imports from £334.8bn in 2022 to £262.5bn in 2023 while the total value of fuel imports fell by a third (31%) or £36.7bn from 2022.
The total value of goods exported from the UK dropped by £32.8bn or 8% in 2023 from £425.5bn in 2022 to £392.7bn in 2023.
Shift in established partners as trade with China drops
Analysis found there was also an adjustment in the UK’s top export trade partners, with China falling out of the top five in 2023 in tandem with its economic slowdown. In fact, the UK recorded a 28% drop in exports to China over the past year, falling from £28.9bn in 2022 to £20.9bn in 2023.
Exports to the US, Germany, the Netherlands, Ireland and France made up 45% or £178.5bn of total goods exported in 2023.
The UK’s top import partners also saw a shift from 2022, with China losing second place to the US with imports declining by 21% from £70.8bn in 2022 to £55.9bn in 2023.
The UK’s five biggest import partners – Germany, US, China, Netherlands and France – made up 48% or £281.7bn of total goods imported in 2023, nearly a £10bn drop from last year’s £291.4bn total.
Trade sanctions with Russia eroding trade levels
Imports from Russia fell from £5.1bn in 2022 to £56m in 2023, signalling a 98% decrease in a single year and collapsing to its lowest level since 1997 when comparative data began, as trade sanctions continue to restrict trade.
Prior to the conflict in Ukraine, in 2021, Russian imports totalled at £10.4bn, making it the UK’s 13th biggest import partner. In 2023, it was the UK’s 103rd biggest import partner, putting it next to the Seychelles, and Gabon.
Exports to Russia also saw a sudden 30% drop in 2023 from £1.2bn in 2022 to £857 million in 2023. In 2021, Russia was the UK’s 23rd biggest export partner, in 2023 it was the UK’s 47th.
Phil Monkhouse, UK country manager at global financial services firm Ebury, commented: “This trade data underscores the need for international businesses to take a flexible and strategic approach to navigating geopolitical shocks.
“These statistics demonstrate how economic and geopolitical events can suddenly impact supply chains across the world, and with many risks still present it is important that businesses are taking appropriate action to protect themselves.
“The UK government is set to continue its post-Brexit trade crusade this year, with talks on trade agreements ongoing with major nations like the US, India, Canada, Switzerland and more. Ahead of a General Election, it will be interesting to see whether this can stimulate a return to growth in imports and exports as the economy continues to recover and the pound keeps strengthening.
“Given the challenging business landscape in the UK, expanding operations on a global scale, hedging against any FX volatility and leveraging streamlined trade processes can help mitigate risks and diversify revenue streams effectively.”
