UK creeps out of the recession

UK creeps out of the recession
Small businesses will welcome news that the recession has officially ended in the UK. According to recent figures from the Office of National Statistics (ONS), the last quarter of 2009 shows that the economy grew by 0.1%.

Towards the end of 2009 increasing numbers of people rushed to spend before VAT returned to 17.5% from 15% in January this year, helping to boost the economy. In addition to this the government car scrappage scheme introduced last year has also contributed to the UK moving out of the recession.

The Chairman of the Federation of Small Business, John Wright, stated that for recovery to strengthen it is crucial to boost consumer confidence. Mr Wright added that interest rates need to be “held steady as continued investment in the economy will be the key to ensuring a sustainable recovery.”

The British Chamber of Commerce Director General, David Frost, also commented, stating:

“This is good news, but clearly growth is anaemic, and it certainly means that the economy is far from being out of the woods.”

However, Mr Frost warned that the 1% increase in employers’ national insurance contributions and additional business taxes to be imposed on small businesses must be avoided in order to aid recovery.

The outcome has generally disappointed analysts as they expected to see growth of 0.6%. The figures also showed that the UK’s economy shrank by 4.8 over last year and contraction had been seen for 6 successive quarters.

26/01/2010 15:45:10 Comments 0

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