A gloomy picture for U.K.’s economy

TEXT OF STORY

Steve Chiotakis: There’s a report this morning that the future of the British economy is — in its words — “fraught with danger.” We don’t use that word “fraught” very often, and Marketplace London Correspondent Stephen Beard reports
some indicators are painting a gloomy picture.

Stephen Beard: In its latest quarterly survey the British Chambers of Commerce says the U.K. economy is still struggling to pull out of recession. And it faces a major threat. The group argues the maximum period of risk will be the middle of next year. The government and the Bank of England will then begin to wind down their stimulus measures. Without that life support, says the Chambers of Commerce, the U.K. economy could falter.

The group’s chief economist is David Kern. He says Britain has suffered worse than its European neighbors because of an over-reliance on London’s financial center.

DAVID KERN: When the recession came the collapse of many of our main banking institutions has created a particularly big hole in our public finances.

He says Britain’s exporters have received a boost from the sharp drop in the value of the British pound. But until the global economy picks up, the U.K. cannot expect an export boom to pull it out of trouble.

In London this is Stephen Beard for Marketplace.