By Maximilian Clarke
A survey of the UK’s business leaders has revealed widespread mistrust in the Government’s ability to bring about a recovery, coupled with a lack of confidence within the private sector that has led to internal investment plans being scrapped.
Exporters, however, were more confident about their future, Barclays Corporate’s survey of 300 leaders from companies turning over in excess of £5m, suggests.
In the lead-up to the Chancellor’s Autumn Statement, 43% of survey respondents said they had shelved plans to invest recently due to current market turmoil, while 66% of corporates expect to see more business failures in their sector and 54% view the private sector as too risk adverse.
The private sector is not looking to Government to resolve the current economic malaise; with just a third of UK corporates believing the Government has the ability to drive economic recovery and has the strategy to do so. Another third believe the economic situation is simply too much of a global issue for the Government to resolve.
“It is clear that UK corporates believe the economic recovery is not going to be Government led,” Ian Stuart, Managing Director, Barclays Corporate. “This is not a criticism of Government but a recognition of the limits of Government. Businesses accept they have to compete their way to better times.
“The challenge is back on businesses themselves. It is easy to say no to risk taking in the current environment, but it must be done if corporates are going to compete globally, both for the success of the individual business and the economy as a whole.”
The vast majority of respondents also said the environment in which they do business is becoming either steadily or rapidly more competitive, highlighting the challenges faced by businesses today.
Despite the challenges, however, exporting remains a bright spot. Of the corporates surveyed that export, 60% predicted the amount of goods or services they sell aboard would grow in 2012, compared with just 3% that predicted export orders would fall. It was one area that corporates were crying out for more Government assistance, with 85% of corporates stating the Government could and should be doing more to support trade.
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