Triple-Dip Recession 'To Be Avoided': BCC

The UK's manufacturing and services sectors have strengthened in the first quarter of the year, according to the British Chambers of Commerce (BCC).

The group's survey of more than 7,000 businesses revealed that export orders and sales in services were particularly strong - close to their all-time high in 1994.

Investment levels and business confidence about the next 12 months also increased over the period, the BCC said.

It comes ahead of GDP figures for the first quarter of the year - which, if negative, would mean that Britain had slipped into its third recession in less than five years.

But the BCC's chief economist, David Kern, said its survey results showed the economy had continued to grow at the start of 2013.

"The survey reinforces our assessment that recent GDP figures published by the Office for National Statistics have exaggerated the weakness of the UK economy and the volatility in output," he said.

"If an announcement of negative growth in the first quarter is misleadingly described as a triple-dip recession, confidence will again be damaged unnecessarily."

The EEF said the poor state of the UK's roads were hitting businesses

The BCC warned that despite the economic improvements, most of the group's key indicators remain below their pre-recession levels, last seen in 2007.

But the survey's positive report on Britain's manufacturing contrasts with separate figures which showed a contraction in the sector for the second consecutive month in March.

The Markit/CIPS manufacturing purchasing managers' index came in weaker than forecast for the month, but was slightly higher than February's four-month low.

In response, EEF manufacturers' organisation said there had been little to suggest the sector had staged a recovery in the first quarter of the year – despite the BCC's survey.

"The continued weakness in the PMI is disappointing overall, but of particular concern is another month of falling export demand," the EEF's chief economist Lee Hopley said.

"While manufacturers have made some good gains in non-EU markets over the past couple of years, the ongoing drag on orders from the eurozone is still significant and likely to impact on prospects over the coming months."

It comes as the group called on the Government to boost spending on roads - ahead of investment in high speed rail.

The EEF said that half of their members said their operating costs were significantly higher because of the poor state of the UK's roads.

It said an independent infrastructure commission should be set up to "take the politics out of" spending plans.

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