In its quarterly forecast, the British Chamber of Commerce has predicted that the UK economy will grow by 0.6% rather than the 0.8% it had previously forecast, warning that the UK’s economy still faced serious challenges with debt levels that are too high and unemployment set to rise to almost three million by the start of next year.
John Longworth, the Director General of the British Chamber of Commerce has urged the Chancellor, George Osborne, to “pull out the stops” in the budget to help drive growth, saying: “Our economic forecast underlines the need for the Government to deliver a Budget that will bring confidence to businesses.
“Businesses up and down the country are doing their utmost to find new markets and grow their firms, despite the difficult economic challenges they face. Only the private sector will drive recovery and help deliver public services, like education, healthcare and pensions.
“A sustainable recovery depends on creating the right conditions to empower businesses to drive growth. Companies need the best possible environment to generate wealth and create jobs.
“The Government must stick to plan A, but also stimulate growth within the economy. There is room within the current spending envelope for measures that will encourage firms to export, invest and grow.”
The quarterly forecast, from the British Chamber of Commerce, has also warned that growth is likely to be lower than expected in the second quarter of 2012 due to the extra bank holiday in June for the Queen’s Diamond Jubilee; whilst in July and August there could be unusually high growth figures due to the Olympics.
It added that growth from exports and business investment will prevent the UK from falling back into a recession this year, with prospects set to improve further in 2012, when the British Chamber of Commerce predict the economy will expand by 1.8%.
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