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ECONOMIC PENDULUM SWINGING IN RIGHT DIRECTION BUT EXTERNAL SHOCKS COULD REVERSE THIS COURSE

[ 17-10-2013 ]

 Economic pendulum swinging in right direction but external shocks could reverse this course

 

Scottish Chambers of Commerce have today (Thursday) released their Business Survey results for the third quarter of 2013.  This broadly based survey, now in its 30th year and conducted in conjunction with the University of Strathclyde’s Fraser of Allander Institute, reported that in all sectors trends in business confidence are stronger than a year ago, indicating that the economy is still progressing towards pre-recession levels. But the recovery remains frail and it is apparent that its sustainability is by no means yet certain.

 

Liz Cameron, Chief Executive, Scottish Chambers of Commerce, said:

“The Scottish Chambers of Commerce Quarterly Business Survey shows welcome signs of growth for Scotland’s economy.  The hard work of Scotland’s businesses is to be commended. These results show that we are on the right track.  We now need to ensure that this renewed confidence continues to follow an upward trend.

 

“Compared to a year ago, business confidence has increased and all business trends in all sectors are stronger, showing positive steps towards sustained economic growth. There are encouraging signs of increased consumer activity with improving retail sales and stronger tourism trends. This is good news for Scotland and for Scotland’s businesses.

 

“The manufacturing sector has seen orders rise at the highest rate since 2007, construction respondents reported a rise in investment intentions and the long-term decline in retail sales ended with retailers reporting increased optimism for the first time since 2006.


“However, economic vulnerability remains.  Much depends on continuing positive trends in our major export markets and on speedy resolution of any remaining US fiscal issues.  Importantly, prices and wages remain disconnected and so household incomes continue to be squeezed; this creates risk in reliance on a consumer driven economy, which is why Government rhetoric about investment and sustainability needs to become a reality to enable continued growth and confidence.

 

“Business confidence and future optimism is on the right course and governments must align their policies with businesses to continue this journey of a sustainable recovery. Now is the time for a comprehensive review across the Scottish Government of all business support provided by the public sector in Scotland, to make certain that Scotland’s EU funding allocation and other public spending is being invested effectively to catalyse and ensure solid Scottish economic growth.

 

“The survey results demonstrate that there is a need for Scottish international exports to accelerate.  Increasing international export income is an important element of strengthening economic recovery.  Scottish Government must increase and improve support to Scottish businesses to complete globally.

 

“The UK Government needs to look hard at where it is presenting barriers to business growth, in particular the taxation system.  For example, the abolition of Air Passenger Duty would contribute to growing our export market opportunities and attract increased investment to create and sustain Scottish jobs across all sectors; the UK Government should act on this.

 “Both the UK and Scottish Governments need to look at their policy and spending priorities to make sure that they are supporting businesses to grow and invest sustainably; without business growth built on strong foundations, this recovery will falter.”

Click here for the survey and findings

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