UK economy continues to flatline

Reacting to the ONS GDP figures for February, David Bharier, Head of Research at the BCC, said:     

“Although today’s GDP figures indicate the UK economy continues to technically avoid a recession, it’s now clear we are stuck in a prolonged period of almost no growth.

“After a sharp drop in business confidence last year, our latest research shows that optimism among SMEs is now on the way up. But this is yet to translate into an improvement to business conditions in general.

“The BCC expects GDP to contract overall by 0.3% in 2023, a view echoed by the IMF forecast in their World Economic Outlook published earlier this week.

“The business environment needs to improve quickly to ensure confidence doesn’t fall back to the levels we saw last year. While last month’s Budget included several positive measures for the economy, it did not go far enough to shift the dial on growth which remains stubbornly low.

“The Government has not addressed some of the major issues holding firms back, such as the unprecedented energy price shock and record tightness in the labour market.

“Following the attention being given to the Windsor Framework by world leaders this week, global trade also needs to be a core priority. UK exporters have faced major administrative costs since the introduction of the Trade and Cooperation Agreement with the EU and the focus must now be on ensuring the new customs and paperwork arrangements work smoothly for businesses both side of the Irish Sea.”