Partner Article

Recovery gathers momentum on strong exports

The economy rebooted in the second quarter of 2013 as export balances strengthened, according to a major survey from the British Chambers of Commerce (BCC).

7,400 UK businesses were quizzed for the study and the responses indicated confidence is significantly also stronger than it was during recession.

Export balances were positive as services deliveries rose to +36%, the highest point since 1989, and orders rose three points to +29%.

Cashflow balances remained weakened, particularly in the service sector, but with small advances in manufacturing.

John Longworth, director general of the BCC, said: “Despite gloomy media headlines in recent months, our economic survey once again shows increased business confidence. UK firms are determined to make progress.

“It is incredibly encouraging to see export deliveries reach record levels, and the upturn in employment balances is reassuring in spite of the risks at home and abroad. However the falls in the service investment balances and the weak cashflow balances in both sectors are a warning that economic growth could be slow, and a reminder that a sustained upturn cannot be taken for granted. For these reasons, business access to finance, and working capital in particular, must be assured.

“British firms are doing their utmost to drive recovery. The sheer strength of our export balances shows that companies have untapped potential to expand. It must be recognised that recovery will only be turbo-charged if we can create a truly enterprise-friendly economy here in the UK. That, in turn, requires swift delivery of the infrastructure boost promised in the Spending Review, more support for exporters seeking to enter new markets, far more action on finance for growing companies, and a relentless government commitment to enabling the private sector to generate wealth and prosperity.

“If we want Britain’s economy to be great, rather than just good, pro-growth policies will need to continue for decades to come. Otherwise, we may be in for a long and slow road to recovery – a prospect with little appeal for either business or government.”

The BCC’s chief economist, David Kern, called on the Monetary Policy Committee to curtail quantitative easing so as not to trigger inflation and keep interest rates low to encourage investment.

This was posted in Bdaily's Members' News section by Tom Keighley .