The report found that the UK was the fifth greatest digital tech services exporter in the world, at £23.3bn in 2019, sitting behind India, the US, China and Germany in the global rankings. This position is driven by a relatively high number (7,497) of high growth exporting tech companies in the UK, many of which are yet to realise their full exporting potential. 

UK digital tech services currently export a much greater value of goods than they import, generating a significant trade surplus of 55% in 2019. This compares favourably to the average trade surplus among the top 57 countries globally, which is 48%. UK digital tech trade surplus has increased by 68% over the last four years - from £8.7bn in 2015 to £12.8bn in 2019 - now just behind the insurance sector (£16.9bn) and financial services (£43.4).

The report also shows that the US was the biggest importer of global digital tech services in 2019, valued at £34bn, followed by Germany at £33bn and China at £21bn. India, Japan, and Brazil have seen the biggest growth in the level of tech services they import - by 29%, 24% and 17% respectively between 2018 and 2019.

Boosting export growth

According to recent projections (Oxford Economics, August 2020), digital tech is currently on the path to boosting exports by an additional £8.15bn, bringing total digital tech exports to £31.45bn by 2025.

Tech Nation’s Chief Executive Gerard Grech commented upon this estimate: “The UK is a natural home for many scaling tech businesses, and there are a proportionally high number of scaling tech businesses located here that are already well-established in delivering domestic tech services.

“The UK is also third in the world for the number of UK tech unicorns, and number one in Europe. These factors give us a strong conviction that UK founders, government and industry leaders should all be gearing up to double tech exports by 2025, in the aftermath of both the pandemic and Brexit. By doubling exports, UK tech could contribute an additional £23bn to the economy per year by 2025 and move up the ranks to become a top global exporter of tech.”

The UK leads Europe for Digital Trade conditions

Looking ahead at where global opportunities lie for UK digital tech service companies to boost exports, Tech Nation has created a Global Opportunities Index that ranks the top 25 countries in order of which are the most attractive countries to do business with.

The US and the UK are first and second in the world respectively for digital tech trading opportunities. This is driven by UK online retail and e-commerce sales, which were valued at £688.4bn (which also includes domestic sales) in 2018 - more than 8x that of France, with £82bn. For UK tech companies, Singapore and Brazil are the fastest rising global opportunities for trade, climbing five and 17 places respectively in the country rankings for global tech opportunity between 2019 and 2020. 

The rankings are determined by factors that contribute to the attractiveness of a location for doing business, with an emphasis on digital tech products and services. Variables such as infrastructure, access to talent and education levels, ease of doing business, regulation, language and consumers are weighted and aggregated to give a sense, for each country, of the opportunity for trade.

Exports Minister Graham Stuart said: “Today technology plays a vital role in almost all sectors and its importance has only increased during the pandemic. So, it's unsurprising that the sector is and will continue to drive our economic recovery. 

“With UK digital tech exports projected to grow by 35% by 2025, this report shows the potential UK exporters have in the sector. The trade agreements that we are currently negotiating will create an exciting future, allowing businesses to export their goods and services across the world more easily. 

“London Tech Week is a fantastic opportunity for British businesses to showcase their talent and provide innovative solutions to the challenges we face. Our tech innovators come from every region of the UK, in fact 25% of Europe’s cities with the highest investment in technology last year are located here in the UK, proving the strength of our world-class tech sector.”