UK Growth Forecast Raised By OECD

International Growth Forecast For UK Has Tipped Economy To Expand By More Than Three Per Cent This Year


Steven Beahan, Partner | +44 (0)114 294 7868

Britain's economy has been tipped to grow even faster than previously thought this year, as more developed nations resume their position as the biggest drivers of global economic growth.

The Organisation for Economic Co-operation and Development (OECD) Economic Outlook has said the world economy will expand by 3.4 per cent this year, with leading economies such as the G7 seeing better growth while the picture is "mixed" in emerging nations.

It declared: "the underlying picture continues to be of strengthening growth momentum in the major advanced economies," identifying Britain as being one of the strongest performers.

Indeed, the UK is expected to see gross domestic product growing by 3.2 per cent this year and 2.7 per cent in 2015, with the outlook also tipping unemployment to be 6.9 per cent this year and then drop to 6.5 per cent in 2015. The government's deficit is also tipped to go on falling while the Consumer Prices Index rate will remain around the target rate of two per cent.

The OECD country profile for the UK also projects that growth will be bolstered by continued rising consumer spending and will be "further boosted by a pick-up in investment".

Such news is likely to be positive for SMEs in Britain on several levels. More investment and employment is an obvious indicator that matters are improving, but the OECD's outlook also offers cheer to those who export goods and services to the eurozone, as this has also been identified as moving into a period of firm recovery.

The upbeat predictions are in line with the outlook for British companies as a whole, who tend to see the future in positive terms as the economy shows signs of increasing strength.

Earlier this week, the Confederation of British Industry's (CBI's) latest SME trends survey found a net balance of 36 per cent of firms expressing the expectation that their fortunes are set to get better, the most positive balance in the 26-year history of the poll.

Expert Opinion
This research is not only good news for the UK, but also for the wider global economy. In turn, the findings are very positive for entrepreneurs who are looking to make a start on these shores, but also for growing businesses which are beginning to set their sights further afield and examine the opportunities available to them in terms of exporting or expanding operations abroad.

"All of the signs indicate that well-positioned small businesses are likely to see some good times ahead, which may undoubtedly mean they turn their attentions to new targets and greater ambitions.

"We would urge small firms to seek specialist legal advice during their planning process to ensure their house is in order when it comes to growing a workforce, seeking new commercial property space or agreeing new deals or contracts."
Steven Beahan, Partner