Business confidence on two-year high

News Article - 15 August 2006
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Companies in the UK are the most confident they have been about the economic outlook for two years, a new index claims.

Businesses in the Midlands were less optimistic about the future climate, however.

Results of the quarterly business confidence survey, jointly carried out by the Institute of Chartered Accountants in England and Wales (ICAEW) and telecommunications firm Orange, suggest that the old north-south divide has been superseded.

A three-tier system now seems to have emerged, with business confidence heading up in the north and south, but downbeat in the Midlands.

Overall, the index stands at plus 9.9, which is its highest level for two years. Confidence was particularly low in the east Midlands, however, where the index reported a negative confidence value of 6.4.

"What we are seeing is the emergence of a three-way split in confidence across the UK," explained Eric Anstee, chief executive of the ICAEW.

"While recent redundancies in the west Midlands contribute towards this picture, a more fundamental examination of economic development strategies in these regions may well be required."

Meanwhile, Shaun Orpen, small and medium enterprise director at Orange, said the study suggested the future's bright for the UK economy overall.

"Businesses have registered a third consecutive rise in confidence this quarter to reach the highest level in over two years," he said.

"Given the healthy national picture, I am confident that businesses will continue to prosper and that this overall buoyancy will enable businesses in the east and west Midlands to overcome the specific economic challenges in their region."

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