The UK economy trotted into recovery earlier this year, but times are currently tough worldwide.
Global markets plunged last week; Germany, the Eurozone’s star economy, faces the possibility of a recession; and UK growth forecasts have been revised downward.
Growth is slowing down, too. Forecasting group EY Item Club now estimates growth of 2.4 per cent in 2015 – a sharp fall from a previously expected 3.1 per cent.
What does this mean for exporters? According to Carl Hasty, director of international payment company Smart Currency Business, companies need to look at risk and rewards of international trade.
“Although international trade appears riskier, the rewards can still be potentially greater,” says Hasty.
“Overseas markets allow a business room for expansion, allowing them to reach a wider base of potential clients. World markets rise and fall. The trick is not to embrace or reject international trade based on every report, but to make calculated long-term decisions regarding overseas trade.”
Businesses trading internationally need to take the necessary steps to de-risk their global growth, he adds, to ensure safer passage through the “tumultuous waters” of international trade.
“Currency exchange volatility is one of the key threats to profitability when trading abroad. Depending on a complex chain of economic events, the rate at which currency is exchanged can mean a significant loss in a business’s bottom line,” Hasty explains.
“Now more than ever, businesses trading overseas need to adopt robust currency-buying strategies in order to ensure that they can benefit from relatively favourable rates.”
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