UK businesses have benefited from prospering trade with the US as they welcomed new deals and seized opportunities to sell services rather than goods, new research shows.
New data from HSBC comes ahead of US President Donald Trump’s state visit to the UK, which begins this week.
It found that British firms are enjoying higher sales with US firms despite many feeling the effects of Mr Trump’s steeper tariff rates on exports.
The value of payments made by HSBC’s business customers in the UK to those in the US surged by 23% in the year to June compared with the prior year.
Payments made to the UK from US business customers also rose by 13% year on year.
A separate survey by the bank of 2,000 UK businesses found a third said they now had more new customers in the US – compared with 16% reporting a decline.
Of those already trading with America, 37% said their revenues had increased, with a tenth reporting a significant rise.
In contrast, a fifth reported falling revenues.
Stephanie Betant, HSBC’s head of global trade solutions, said the agreement struck between the UK and the US in July gave businesses “clarity fairly quickly” in terms of the framework for trading.
Furthermore, she stressed the UK being predominately made up of firms in the services sector means many have been cushioned from the impact of steeper tariffs on goods exports.
“Fundamentally, the UK is a service economy and the US is the number one service economy,” she told the PA news agency.
“If you look at the shape of UK trade over the past four or five years, it’s gone from being largely majority goods to now majority services.”
Services – which incorporates everything from hospitality and entertainment, to IT, communications and healthcare – are not subject to tariffs to the extent that goods exports are.
Ms Betant added that many “goods-focused businesses” were choosing to “add a services layer” to what they offer in order to boost the value of their exports.
This has resulted in more firms investing in digital assets and technology, rather than building up their inventories of physical stock.
Nevertheless, Ms Betant acknowledged there was a “huge amount of disruption” for some sectors such as carmakers and Scotch whisky firms who are facing new and steeper levies to export to the US.
“The environment has created a lot of friction for companies – certain companies wouldn’t have paid tariffs before, now they have to, and when it comes to goods, slowing down shipments,” she said.
“Tariffs are working their way through the system so they are starting to impact more broadly into the economy.”
Ms Betant stressed a key thing businesses were looking for was greater sector-based trade agreements.
