Heathrow Airport has released results of its first “Export Climate Index” which tracks the health of the UK’s export economy and said it found the country is in “strongest position” since 2000.
The quarterly Index, commissioned by Heathrow, was carried out by the Centre for Economics and Business Research (CEBR). The airport said it will become increasingly important as the government moves to establish a new trading strategy, outside of the European Union (EU).
The report found the UK Export Climate is in its “strongest position” since the index began in 2000 , which was a positive sign as the UK approaches the anniversary of article 50 being triggered and as the UK is set to leave the EU in March 2019.
Heathrow said: “A positive Export Climate Index matters as trade and exports benefit businesses, individuals and families across the UK. British people not only benefit through direct earnings in their exported products, but also through knock-on effects in higher spending and employment.”
The Index considers eight measures such as Heathrow flight numbers – including passenger flights, which altogether carry 95 per cent of the airport’s cargo volumes.
Over the last decade, CEBR has found Heathrow’s share in the value of non-EU export goods held steady around 30 per cent, but the value of this cargo has “grown significantly”, by over 150 per cent.
In 2017 alone, £48.9 billion worth of UK exports bound for destinations outside the EU/Switzerland flew through Heathrow.
The airport said: “This analysis clearly shows Heathrow’s role as the main gateway for UK exports bound outside the EU, and the airport’s role to facilitate UK trade post-Brexit, particularly with countries like the United States, currently the most frequent destination for airport exports.”
The Index also finds rising oil prices and the appreciation of the pound in the last three months of 2017 has been offset by UK producers’ high expectations for the future, which ultimately led to an improvement in the export climate.
And there is also increasing consumer confidence among the UK trading partner nations, as government spending drives growth in the US, and China continues to enjoy steady growth.
Heathrow said as the UK’s largest port for non-EU exports by value, the growth of it will have a direct effect on people across the UK.
The gateway said the Index also showed the positive effects of work in 2017 to increase efficiencies and marginally grow its route network to include new routes from FlyBe and Beijing Capital. This increase in flights has offset the decrease in sea port freight units leaving the UK in the last quarter of 2017.
Heathrow said: “While positive, this result is not guaranteed for years to come as Heathrow becomes increasingly constrained. An expanded Heathrow will release capacity, allowing connections to 40 new long-haul destinations, doubling cargo capacity and ultimately more opportunities for the UK’s export climate.”
Previous CEBR research has shown Heathrow’s third runway could add an additional £24,480 of GDP per UK family between 2019 and 2078, compared to another runway at Gatwick.
Heathrow chief executive, John Holland-Kaye noted: “Now more than ever, the UK needs to secure its status as an outward-looking global trading nation. It is clear that Heathrow is essential to trade outside the EU, but as we continue to operate at capacity, we will jeopardise new routes and trade with the rest of the world.
“True transformative change to our flight network – and consequently the UK’s export climate – will only be achieved through the expansion so we can connect all corners of the UK to the growing markets of the world.”
A vote is set to be taken by MPs in the UK Parliament before this summer on whether Heathrow can build a third runway.