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British chamber of Commerce revise 2013 growth figure to 0.9%
The British Chambers of Commerce (BCC) has upgraded its growth forecasts for the UK economy over the next three years from 0.6% to 0.9% in 2013, from 1.7% to 1.9% in 2014, and from 2.2% to 2.4% in 2015.
In its Q2 economic forecast, the business group, which represents more than 100,000 businesses across the UK, warns that while the upgraded figures are encouraging, growth is still too weak and the economy is facing many challenges, both domestically and internationally.
The BCC is urging the Chancellor to use next month’s Spending Review to help create the right conditions to boost enterprise, so that businesses can invest, export, create jobs and drive the recovery.
In a statement the BCC argued that the “The upward revision is mainly due to higher than expected GDP growth in Q1 2013, and a stronger recovery in service sector output and consumer spending”.
Although UK growth is forecast to remain modest until 2015, there will be a gradual medium-term improvement. After rising by 0.3% in Q1 2013, UK GDP is likely to continue growing by 0.3% per quarter in the second and third quarters of 2013. Thereafter, we believe there will be a slow improvement, with GDP quarterly growth edging up to 0.4% in Q4 2013, and 0.5% per quarter during 2014.
Commenting on the revised figures John Longworth, Director General of the British Chambers of Commerce, said that the “upward revision in our growth forecasts is encouraging. We have constantly said that earlier fears of a triple-dip recession were misguided and risked damaging confidence unnecessarily. Upward revisions of official figures may even show there was no double dip recession. There is no doubt that the improved outlook is a tribute to the unswerving determination shown by our members in previous quarters, when there was excessive pessimism over the economy.
“Unfortunately, this does not change the fact that economic growth is still too weak, and the pace of recovery will remain unduly slow for a while yet. We are still a far cry from getting the economy fully back on track. The UK is, and will for some time, be performing below its potential and we can do so much better. But the government must step up its efforts to create the right conditions for an environment that supports enterprise, as this will help more businesses to create jobs, invest, export and ultimately, grow” argued Mr Longworth.
