Stronger businesses will continue to lead growth says YB economist

BETTER than average businesses in the West Midlands will continue to lead the region’s financial recovery, a leading economist has said.

Tom Vosa, chief economist at Yorkshire Bank, said that while home markets are important, above average business growth lies in the ability of firms to export.

“Probably the first recorded economic forecaster was Joseph – of the Old Testament – who said that there would be seven thin years after seven years of fat, and that still applies,” he said.

“It usually takes a similar amount of time to recover from a recession, as the boom years lasted in the first place – and that could well be the case here.

“When people talk about the rebalancing of the economy they mean that there will be less debt available for both companies and domestic households.”

He said this meant the domestic growth rate would be lower because there would be reduced levels of lending and borrowing.

However, he added that the recession was not worldwide and this would help companies in their bid to recover.

Mr Vosa said he believed the Government’s drive to encourage firms to export was key, and again just following historic patterns.

“We have to latch on to thriving markets,” he said. “We might have been in recession but the likes of Australia and Canada, as well as the emerging markets, have not been.

“Around 85% of the world’s population will see an economic growth of around 6% for the next five to six years. We need to profit from that growth, and export is the way to do that.

“We have got a track record of successful exporting to all sorts of markets but we need to build on that.”

Automotive exports are strong and Mr Vosa said he believed this was one reason why the Midlands and the North East had started to recover quicker than other areas.

“Domestic car demand will be back towards average levels because of less borrowing, but abroad we have marques with a very good reputation which are doing well,” he added.

Mr Vosa will be one of the speakers at the Coventry and Warwickshire Chamber of Commerce’s 10th annual conference on Friday, September 16, where he will reiterate his strong message.

The conference takes place at the Coventry University Technocentre. Other speakers include Lord Digby Jones, Sir Peter Rigby and David Frost, chief executive of the British Chambers of Commerce.