HSBC finds 73% of UK tech businesses are optimistic about future US economic relations, with increasing cross-border payments and subsidiary creation.
As global economic uncertainties persist, the technology sector continues to seek new avenues for growth and expansion.
A recent survey by HSBC UK, one of the largest banks in the UK, highlights a growing trend of UK-based technology firms looking towards the US as a promising market for expansion.
This optimism comes amid broader discussions about international trade relationships and the evolving landscape of the global tech industry, particularly in the wake of changing economic dynamics between major economies.
UK tech sector’s inspired by US ambitions
The HSBC UK survey, which polled over 230 decision-makers in medium and large tech businesses, reveals a high level of confidence in the US market.
According to the report, 73% of UK tech businesses express optimism about the future economic relationship between the UK and the US.
The survey also indicates that 17% of businesses perceive no obstacles to their growth in the US market.
Additionally, 30% of respondents who are not currently engaged in business with the US say they would consider doing so in the future.
“The US is a huge market and has so many opportunities for UK tech firms, especially those who have a leading product and a strong market fit,” comments Roland Emmans, Head of UK Tech Sector at HSBC.
However, the survey also identifies areas where support could further encourage UK-US business relationships.
Respondents point to improving exchange rates (43%) and readily available advice from government or banks on expansion strategies (43%) as key factors that could facilitate increased business with the US.
HSBC’s cross-border activity and growth
HSBC UK’s data reveals significant growth in cross-border business activity between the UK and the US across all sectors.
In the 12 months leading to June 2024, the value of payments made by HSBC UK business clients to the US increased by 15% year-on-year, while payments received from the US rose by 5%.
Meanwhile, the first half of 2024 saw a marked increase in cross-border acquisitions and subsidiary creation.
Whereas UK firms acquiring US businesses or creating new subsidiaries in the US increased by 45% compared to the same period in the previous year.
Conversely, US firms’ similar activities in the UK grew by 71%.
Stuart Tait, Head of Commercial Banking at HSBC UK, attributes this growth to several factors, including: “UK businesses view the US as an attractive growth market because of its stable economy, transparent regulatory environment and cultural similarities.”
The case of Ethixbase360, a third-party risk management platform provider, illustrates this trend.
The company, which opened its London headquarters in 2018, expanded into the US market in 2021 and subsequently acquired a US-based company.
Peter Sweetbaum, CEO of Ethixbase360, notes in the report: “Acquiring a company already well-established and respected in the US market was the right avenue for our expansion.
“International growth enables companies to diversify their business, with many viewing expansion into new markets as a quicker way to drive growth, rather than new product development.”
