Survey forecasts deeper and longer recession

THERE were further predictions of economic pain today as a business organisation forecast a longer and deeper recession than expected.

The British Chambers of Commerce said its Fourth Quarter Economic Survey, which polled nearly 6,000 firms, had detected a “frightening deterioration” in business conditions.

It reported too a collapse in business confidence to record lows, with manufacturers and service sector companies reporting the worst data since the survey began 20 years ago.

The grim survey records plunging domestic demand is plunging, falling exports and plummeting confidence.

David Frost, director-general of the British Chambers of Commerce, said: “These are truly awful results with the scale and speed of the economic decline happening at an unprecedented rate.

“We have to focus on holding the productive sectors of the economy together. If we are to climb out of this morass we will need a strong business base.

“A clearly defined National Recovery Plan will need to be rolled out as soon as possible, involving all politicians.”

The organisation’s chief economist, David Kern, added: “The measures taken in recent months have failed so far to alleviate the downturn. The Q4 results signal big increases in unemployment.

“A prolonged recession can still be averted, if the authorities adopt urgent and additional forceful corrective measures. Interest rates will have to be reduced to almost zero…The smooth flow of finance to businesses must be sustained at all costs, and business taxes will have to be cut.”