Worst of the recession is over, claims British Chambers of Commerce
Jill Park, packagingnews.co.uk, 08 July 2009
The British Chambers of Commerce (BCC) has said that the worst of the recession is over, but has warned against complacency in a still-fragile economy.
The BCC’s Quarter 2 Economic Survey for 2009, which was published this week, revealed that key indicators appear to be improving for the 5,600 companies surveyed.
However performance is still weak compared with previous years.
"The worst of the recession is over, but serious downward pressures persist across all sectors," said chief economist at the BCC David Kern.
"Most key balances are still in negative territory and remain weak by historical standards. Recovery is now possible, but it is not yet secure."
BCC director general David Frost urged the government to "Think long and hard about its policies on taxation and red tape".
"Signs of improvement in the economy cannot be en excuse for the government to start increasing business tax as a remedy for the ill health of the nation’s finances," he said. "Risking any fragile gains would be a huge mistake."
According to the report, manufacturing has recorded stronger improvements in Q2 than services, but Nicholas Mockett, partner at Europa Partners attributed this to destocking.
"In September and October, when life got even harder than everybody was expecting, destocking took place. We then got to unsustainable stock levels," he said. "Perhaps what we are seeing in Q2 is people getting back to normal stock levels."
In Mockett’s opinion, services are a more accurate reflection of the economy as they "reflect more immediate demand".
