AIB has announced a new €200 million fund to support exporting companies in Ireland.
The fund was announced alongside the release of the bank’s latest Exports Outlook Report for SMEs.
The report, produced in association with the Irish Exports Association, Bord Bia and IPSOS MRBI, shows an upbeat mood among small and medium Irish businesses.
Of the 200 SMEs surveyed for the report, 65% say they expect stronger export sales in 2014 and 30% plan to export to new markets, notably the US, Germany, France, Spain and China.
Exports accounted for almost 40% of all SME sales in 2013, with the UK remaining the most important market for Irish exporters. Three-quarters of all those surveyed say they export to the UK – and it represents the only export market for 43% of them.
Almost half of those surveyed (46%) expect their export level to increase in 2014 on last year. Meanwhile, almost 40% say their staff levels will increase this year.
“Food and drink companies are optimistic to build on the €10 billion exports achieved in 2013,” Bord Bia’s Director of Markets Michael Murphy said on the launch of the report.
Ken Burke, AIB’s Head of Business Banking, said that the latest Exports Outlook Report findings show the potential for growth in SME exports:
Against the backdrop of improved business performance in 2013, it is important that AIB supports SMEs as they continue to build in existing markets and identify additional export opportunities. The research suggested that banks needed to do more for exporters and have a better understanding of exporting.
In addition to the launch of the €200m SME support fund, Burke said that the bank has partnered with DHL to provide “a 50% discount on DHL Express standard tariffs for international shipping for all AIB exporting customers for 12 months”. The bank has also appointed 85 ‘Export Finance Champions’ around Ireland to advise SMEs on practical export information.
Meanwhile, Irish Exporters Association CEO Simon McKeever described the export market as the “lifeblood of the Irish economy”, for driving innovation, growth and employment in Ireland. He welcomed AIB’s initiative to support SME exports, adding that “access to finance remains an issue for many exporting SMEs”.
According to the Outlook Report, of the SMEs that expect to see an increase in their export turnover this year, almost 72% will use existing resources from retained earnings to fund this growth, while another 25% believe they will require new finance.
Almost a third of all the companies surveyed applied to their main bank for some form of finance to support their export business growth last year. “Excluding any requests that are still pending, 80% of all requests made for export-related finance in 2013 were approved,” the report says.