Security exports up 18% according to UKTI DSO statistics

July 15, 2014

Last week UK Trade & Investment Defence and Security Organisation (UKTI DSO) published the official export statistics for 2013. This is the first year these statistics have been designated ‘Official Statistics’. SecurityNewsDesk spoke exclusively to UKTI DSO to find out more.

UK defence and security exports in 2013 totalled £13 billion, comprising defence exports of £9.8 billion and security exports of £3.2 billion. The combined figure represents a 13% increase on the previous year. Defence exports increased by 11% and security exports by 18%.

Before we took a closer look at the breakdown of the figures, SecurityNewsDesk asked UKTI DSO why it has taken until now for defence and security export reports to be classed as ‘Official Statistics’.

“We have always sought to ensure that the statistics released by the organisation are robust and transparent,” said a spokesperson for UKTI DSO. “In 2013, the BIS statistical team carried out a review of teams (including UKTI DSO) releasing statistics whose data hitherto had not been categorised as ‘Official’ or ‘National’. This was to establish if they could be so classified, part of our continuing efforts to ensure users of the data see uniformity across government in terms of statistical releases and have trust in the data. We were delighted to be advised that UKTI DSO export statistics could be designated as ‘Official’, provided we met some additional criteria, principally relating to methodological commentary, transparency and accessibility. The 2013 figures are designated as ‘Official Statistics’, in accordance with the Code of Practice for Official Statistics.”

The above graph demonstrates that security export figures have been steadily increasing since 2007, so an 18% increase in 2013 is right on trend. Indications are that the Global Security sector is going to grow significantly over the next few years, with the Cyber Security sector growing particularly fast.

The definition of the security sector was first agreed in 2007/ 08 and was updated in 2011 to include additional “Cyber Security” activities. It has been updated once again in 2013 to reflect significant changes in the content and reporting of Cyber Security activities, with this year being the first year that Cyber Security has been recorded as an independent category.

The report states that in the security sector, around 40% of UK exports can be attributed to Cyber Security products and services. So why does UKTI DSO think this sector has grown so quickly and what implications does this have for the future?

The UKTI DSO spokesperson said, “The cyber security market is growing rapidly with new technologies and solutions being developed all the time. The UK government has done a substantial amount of work seeking to ensure the categories and classifications of cyber are broad and sufficiently flexible to accurately reflect the market. We expect these classifications to evolve and adapt over time as the industry itself grows and changes. Our data provider has a rigorous and systematic process in place to ensure relevant data is captured and reflected in the published statistics.”

As the below graph shows, the statistics for 2013 provide a clear breakdown of the type of security products that the UK exported – including Cyber Security solutions.

It’s clear that the UK is doing very well with exports in Situational Awareness, System Recovery & Data Cleansing, Communications and Access Control. However, despite being granted its own category, Cyber Security is a relatively small export market for the UK at the moment.

Also of note is the difference between defence and security with regards to where the UK is exporting to.

The above shows clearly that the Middle East is the top export destination for UK defence exports. However, if you look at the below graph demonstrating security export destinations, the Middle East does not even feature.

The UKTI DSO spokesperson commented on this anomaly, saying, “A lot of activity has taken place over the last year and there has been significant interest in the region in areas such as border and airport security. However, this has not resulted in significant contracts but we expect this situation to improve next year.”

Overall, this report concludes that the UK’s share of the global security market will be worth 4 per cent (£3.2Bn), making the UK the 6^th largest exporter of security products and services. So it’s clear that while there are challenges to overcome and high targets to hit, the UK’s security industry is going strong and has a bright future ahead.