London at Risk of Sliding into Recession, Says Study
Kay, William, The Independent (London, England)
LONDON COULD slide into recession next year, paving the way for a narrowing of the North-South divide, according to a new study.
The report, by the research group Business Strategies, says London's greater exposure to former "hot spot" sectors such as banking, tourism and business services, will make it more vulnerable. A marked slowdown in household spending is also expected to drag down growth in the capital and other southern regions in the next 12 months. The report says the capital's greater reliance on these sectors makes it more exposed to the impact of the terrorist attacks of 11 September.
"All this will mean a temporary halt to growth in the South's share of output and jobs," said Dr Neil Blake, research director at Business Strategies. "In the North, where industry is more heavily represented, growth has already suffered as manufacturing has slipped into recession this year, though an upturn is in prospect from 2002."
However, the South-east is still expected to grow faster than the rest of the country over the next five years.
Business Strategies says the global downswing is forecast to push economic growth down to 1. …