UK businesses see euro crisis as biggest challenge
LONDON MORE than two-thirds of business leaders in Britain believe the eurozone debt crisis will be the biggest challenge facing the country’s economy next year, an opinion poll showed on Sunday. Seventy percent of business chiefs believe the euro crisis is “the biggest single factor likely to impact on the UK economy in 2012,” showed the poll for the Confederation of British Industry (CBI), Britain’s biggest business group. The finding echoes the coalition government’s insistence that the eurozone crisis, rather than its programme of public sector cuts, is responsible for the darkening outlook. Last week, the Bank of England slashed its growth forecasts for 2012 and figures showed that the jobless rate hit a 15-year high in the three months to September. In Sunday’s survey, 67 percent of the 122 business chiefs questioned also cited the “possibility of a further banking crisis” as a major concern for the British economy in 2012. And 70 percent of those quizzed said their confidence in the country’s economic outlook had fallen since the start of August, as the debt crisis escalated. Although Britain is outside the 17-nation group that uses the euro, almost half of its trade is with the bloc. Despite fears the economy was heading into a turbulent period, 82 percent of those questioned were firmly behind the Conservative- Liberal Democrat government’s austerity measures aimed at reducing a record deficit. “Business leaders believe the government is right to stick to its deficit reduction strategy, but that it must go hand-in-hand with some fresh thinking and a more creative growth strategy,” urged CBI director general John Cridland. He said the government should prioritise infrastructure investment, employment and business tax cuts, as well as reviving the housing market in order to stimulate growth. Pollster Ipsos MORI carried out the study for the CBI, interviewing 122 senior business figures from the 350 biggest companies listed on the London stock exchange. The CBI holds its annual conference Monday.