Finance

Finance

UK gets out of longest recession

26 January 2010 15:14 (UTC +04:00)

Baku â€“ APA-Economics. Britain has limped out of its longest-ever recession in the fourth quarter of 2009, official data shows, but massive debt is set to stunt recovery beyond a looming general election, AFP reported.
GDP grew by only 0.1 percent in the three months to December, compared with a 0.2 percent contraction in the third quarter, the Office for National Statistics said.
Britain’s return to growth may not be enough for embattled Prime Minister Gordon Brown to keep his job at a general election due by June, however, as the nation faces a tough period of recovery.
Brown is "confident but cautious" about growth ahead, his spokesman said on following the first official estimate of fourth quarter GDP.
The positive figure -- which undershot expectations of 0.4-percent expansion -- marked the end of a recession that began in the second quarter of 2008 as a result of the global financial crisis.
Britain’s return to growth leaves Spain as the only major economy still trapped in recession.
Like many Western countries, however, Britain’s public debt has rocketed to record levels as the government spent billions on financial stimulus measures and banking-sector bailouts.
"The UK economy finally exited recession in the fourth quarter last year, but at a snail’s pace," said economist Jonathan Loynes at consultancy Capital Economics.
"With households under pressure, credit in short supply and a fiscal squeeze looming, the path back to pre-recession levels of activity will be a long and bumpy one."
Commentators also argued that the return to economic growth was skewed because temporary factors had lifted GDP -- the total value of goods and services produced in an economy -- particularly in the retail and car sectors.