pumpkinstrokemarrow

First, the amount of trade in goods is rather more than our production of goods. So there must be an awful lot of coming and going in production.

Second, we do more trade in goods than we do in services.

Third, services is growing as a proportion of exports. From a third to a half from 1996 to 2006.

Fourth, the killer blow. Financial services were in surplus by around £15 billion in 2005. Other business services were in surplus by around another £15 billion in the same year. The total of £30 billion is about the same as the surplus on services as a whole. And about the same as the overall deficit on goods and services, also £30 billion. This because of balancing deficit of £60 billion in goods. So while financial services might not be that important absolutely, they are important as a contribution to our balance of payments.

Policy advice: ban holidays abroad. Travel - most of it by bog standards - is in deficit by yet another £15 billion, completely knocking out that tremendous contribution from the boys in the city.