The British Chambers of Commerce predicts that Britain’s GDP will finally catch and exceed its 2008 peak within the next few months. Strong growth in consumption and the services sector in 2014 will take the UK back to where it was six years ago.
The BCC upgraded its gross domestic product (GDP) growth forecasts from 2.7 per cent to 2.8 per cent in 2014 and from 2.4 per cent to 2.5 per cent in 2015. The BCC also forecast economic expansion of 2.5% for 2016.
The more optimistic forecasts mean the UK economy is set to exceed its pre-recession size in the second quarter of this year, one quarter earlier than the BCC had predicted at the end of last year.
BCC director general, John Longworth said the UK economy was gaining momentum on the back of business expansion and job creation. However, he also warned against the lack of funding for UK and Irish SMEs:
“Crucially, Britain is simply not investing enough. While business investment is expected to grow, it will remain way below pre-crisis levels for some time. There is also more to do in securing access to finance for growing firms – as this too will be crucial to securing our economic future” he said.
Commenting on the figures Kate Sharp, chief executive of the Asset Based Finance Association, said:
“Asset Based Finance is ideally placed to provide the access to finance John Longworth warns is missing. Last year Members of the ABFA provided the largest amount of funding ever to over 43,400 clients, which in turn helped them to hit record amounts of sales. The latest figures (quarter four, October – December 2013) show both the highest ever quarterly funding balance and record annual sales turnover for companies using asset based finance.
Total funding advanced by ABFA Members to clients hit £18.3 bn. In December 2009 the balance was £13.9 bn, but since then it has grown steadily most quarters to over £18 bn just four years later, an aggregate growth of some 32 per cent. The balance has grown 11 per cent in the past year alone and 3.5 per cent in just the last quarter.
Matching this record breaking growth is the sales turnover from companies using asset based finance. Total client sales for 2013 were over £275 bn, a growth of 10 per cent year-on-year. In 2010 the total turnover figure was £211 bn; this shows a cumulative current growth of 30 per cent in three years, underlining just how much asset based finance has supported UK and Irish firms with their sales growth since the financial crisis.
Export figures for both factoring and invoice discounting also showed robust growth, with year-on-year increases of 18 per cent and 12 per cent respectively. These figures indicate the vital role ABFA Members play in keeping the UK and Irish economies afloat.”
The ABFA is the body that represents the asset based finance, including Invoice Factoring and Invoice Discounting, in the UK and Ireland. Members range from subsidiaries of major international banks to independent finance providers. The ABFA provides a variety of services to UK and Irish members, including on-line services, educational courses, PR, and educational and networking events. In addition, the ABFA is a source of information and reference for businesses looking to find out more about the products and services that this industry can offer.