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Leaders urge caution as recession ends

Business leaders have warned North East firms that the end of the recession does not mark the end of ongoing tough trading conditions.

The UK has officially edged out of the longest recession in modern history, although the economy only grew by 0.1% between October and December.

The Office of National Statistics figures were disappointing compared to the forecasts of some analysts who predicted that the economy would make a 0.4% recovery.

The UK is the last major economy to emerge from a full-blown downturn after the US, Japan, China, Germany and France came out of recession by September last year.

However, while the news was hailed as a morale boost to corporate UK, business organisations in the North East moved quickly to warn companies that there may still be gloomy times ahead.

Sarah Green, director of CBI in the North East, said: “Whilst this is good news for most people, it will feel like a mere technicality.

“It’s technically the end of the recession, but it won’t feel any different for business out in the real world.

“We need a new strategy for growth and we are urging the Government to focus on how we are going to move forward.”

Andrew Sugden, NECC director of membership and policy, said the news would be a confidence boost to businesses but also warned companies to remain cautious as tough times continue. He said: “The private sector is under no illusions that the hard times have ended. Firms will continue to fight tooth and nail to get back on a firm footing.

“We will also be keeping a close eye on the public sector where cutbacks are inevitable. It is important that these do not hit areas that will stifle local business communities at a time when they need to grow to provide employment.”

Alastair MacColl, chief executive of Business & Enterprise North East, the organisation that delivers the region’s Business Link, North East England Investment Centre and International Trade services, said: “Today’s figures illustrate an encouraging trend but clearly there is still a huge amount of work to do.

“Our own figures illustrate that in the last quarter of 2009, confidence in our region continues to improve with a significant rise in new business start ups and export orders.”

Pauline Osborne, regional chair of the Federation of Small Businesses, said: “Today’s GDP figures begin to show encouraging signs for the region and beyond, although at 0.1 per cent the recovery remains frail.

“In order to strengthen the recovery it is important that we boost consumer confidence and would like to see interest rates held steady as continued investment in the economy will be the key to ensuring a sustainable recovery.”

This was posted in Bdaily's Members' News section by Ruth Mitchell .

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