A corporate insolvency firm has said the UK economic recession has so far led to fewer failed companies than expected, as it reported lower than expected revenues from winding-up firms.
In a statement to the London Stock Exchange, Begbies Traynor said UK insolvencies remained lower than expected but believed this was due to ‘lenient creditor attitudes’ and temporary government support initiatives.
The firm expects the number of ‘insolvency engagements’ to go up early next year, however, due to the unwinding of temporary economic support measures and the impact of public sector cuts.
In a sign of growing confidence in some industries the currency exchange firm Travelex said its Confidence Index had risen eight points during November with importer and exporter confidence unexpectedly surging – 70 per cent said they felt confident about current trade conditions.
Travelex said positive sentiment had been boosted by the stronger than expected economic growth in the third quarter of 2010, with trade making its biggest contribution to growth in two years.
David Sear, Global Managing Director at Travelex Global Business Payments said: “Confidence in the trade sector is pivotal to the UK’s economic outlook. We urge the Government to continue their vital trade overseas missions and support for exporting businesses through innovation and resource, to ensure that growth in the UK export sector is not jeopardised in 2011.”
More importers and exporters feel confident that the UK economic growth seen in 2010 can be sustained. The monthly Travelex Confidence Index tracks the views of small and medium sized importers and exporters across industries and UK regions.
Manufacturing continues growth
The Office for National Statistics’ measure of industrial and manufacturing output said overall production in October 2010 was 3.3 per cent up on October 2009, but there was an overall decrease of 0.2 per cent between September and October, partly driven by decreases in mining and quarrying, and oil and gas production.
The annual increase in manufacturing to October was 5.8 per cent, with the majority of sub-sectors seeing an increase suggesting broad-based growth.
The monthly change was a 0.6 per cent increase from September to October, but the output level is still significantly below pre-recession levels.
In a report published on 6 December, EEF, the manufacturers group, and the accountancy firm BDO said manufacturers continued to report strong trading conditions, with indicators for output remaining at record levels.
The EEF said strong performance, which was broad-based across all sectors and regions, had been underpinned by the robust demand coming from overseas markets, especially exports to the emerging market BRIC (Brazil, Russia, India and China) economies.
“The survey shows that manufacturers have also been recruiting for new employees and making some new investments in response to the stronger than expected recovery in production,” the EEF said.
The 2011 outlook was marked by a ‘softening in optimism’ especially around domestic demand, but expectations remained that the engineering and manufacturing would outperform the rest of the UK economy in 2011.
© Fair Investment Company Ltd