UK economy contracted during Q4 2012

Monday 28 January 2013

City of London

Gross domestic product (GDP) declined in the UK during the final quarter of the year, raising fears of a triple-dip recession.

Negative growth of -0.3 per cent was recorded between October and December 2012, with manufacturing growth down by 1.5 per cent and two per cent on the year.

Service sector activity was flat during Q4 2012, up 1.4 per cent on the year, the Office for National Statistics reported.

John Longworth, director general of the British Chambers of Commerce (BCC), described the figures as "weak".

However, he noted that UK businesses are still confident they can expand in 2013.

“What is clear is that British businesses need politicians to do everything they can to kick-start growth," Mr Longworth stated.

"Business wants to see bold and far reaching measures to drive growth and enable British firms to go head-to-head with their competitors overseas."

He said recent steps to improve access to finance, such as the commitment to create a business bank, must be implemented at scale and with a clear timetable.

More forceful measures are also needed "to unlock massive private funding" to renew Britain's infrastructure, the BCC chief claimed.

Mr Longworth said these measures will help create confidence, jobs and ultimately growth in the UK economy.

Posted by Steve Williams