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CN briefing: Trade deficits, internationalism, and emergency services

For my generation, the first experience of trade was on the playground.

I am, of course, talking about football stickers.

Many a lunch break was spent scouring the school yard to find that elusive Peter Ndlovu or Scott Minto, or attempting to swap one of your many Jason Dozzells for a more glamorous Ian Woan.

And there was always one kid with stacks of Alan Shearers and Denis Irwins to trade with everyone, while he spent all of his spare pennies on extra stickers and swaps.

Twenty years on, and on a rather more global stage, it appears that the UK has taken on that role.

Looking at the latest data from the Department for Business, Innovation and Skills on the trade in building materials, it seems that the concept of balanced trading is one that is alien to the UK construction industry.

In the past five years, the UK’s trade deficit for building materials has grown consistently and considerably.

In 2009, it stood at £4.9bn – but as of 2014 it has reached £7.64bn. That’s an average increase of nearly 10 per cent per year, exacerbated by the fact that growth in exports has been comparatively sluggish – only rising by 2.3 per cent per year, on average.

On the face of it, you’d think that an increasing demand for building materials is a good thing – a sign that the industry is recovering.

And that’s certainly one way of looking at it: booming demand for materials and a strong pound make it a great time for UK suppliers to be importing.

But that doesn’t take the joint industry and government’s Construction 2025 targets into account.

Under the strategy, the government aimed to reduce the trade gap between total exports and total imports for construction products and materials by 50 per cent.

On this evidence, these targets are a very long way off, with the deficit rising by 22.1 per cent in the past two years alone.

And spare a thought for the humble brick – over the same period, that rather essential commodity’s trade deficit has grown by a colossal 272.4 per cent, while last year’s deficit of £74m was larger than those of 2011, 2012 and 2013 put together.

The Construction Products Association is forecasting output growth of 21.7 per cent over the next five years, which suggests imports are likely to increase by a similar magnitude. That means exports will need to be even stronger just to maintain the current deficit.

Read the full analysis of these trade figures here.

HS2 and beyond

In the spirit of trading and internationalism, our reporter Jack Simpson has had an exclusive chat with Spanish firm Acciona’s UK managing director, Jaime Vega, who has said that the firm will use its bid for High Speed 2 work to propel itself into the UK market. Read more here.

Look out for our project report tomorrow, on how Bam is delivering a complex emergency services revamp in a live hospital environment at Aintree University Hospital.

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