A story today
based on the latest quarterly report from the Ernst & Young Item Club economic forecasting group, concludes the UK economy faces 10 years of “painful readjustment”.
It quotes chief economic adviser Peter Spencer saying: “After a decade of relying on the domestic consumer, firms have to start chasing overseas customers…[Economic] growth is almost totally dependent on a sustained upturn in the world economy, and upon the energy and enterprise of UK exporters of our prized goods and services.”
At the same time, the British Exporters Association says without the UK government agreeing to underwrite bonds required by overseas buyers, UK suppliers are missing out on vital business
Governments across the European Union, the US
and elsewhere currently provide this facility to domestic vendors, which makes it even tougher for the UK to compete. Bexa highlighted one manufacturer who missed out on a £3.5 million contract because it failed to secure the performance bond.
And also this week administration firm Begbies Traynor has warned that the withdrawal of temporary measures (like the car scrappage scheme and lower VAT) will see the number of corporate insolvencies rise in the second half of the year.
Surely better public sector spending could help support UK exports and bring money into the country? The £26 billion the Independent
claims the government has wasted on technology projects
would have, for instance, gone a long way to help UK firms.