Open

Coming up

Don't miss

Replay


LATEST SHOWS

AFRICA NEWS

Rwandan singer amongst terror plot suspects

Read more

DEBATE

What's Putin's Plan? Kiev Accuses Russia of Terrorism

Read more

FOCUS

Campaigning against Bouteflika's re-election... in France

Read more

WEB NEWS

Chile: Online mobilization to help Valparaiso fire victims

Read more

ENCORE!

Art, sex, money, memory and manga

Read more

MIDDLE EAST MATTERS

Spat over Iran's UN ambassador hampers thawing relations with US

Read more

FOCUS

China trade deal: Is Taiwan's identity under threat?

Read more

IN THE PAPERS

'Call it a caretaker government'

Read more

DEBATE

Nigeria's Battles

Read more

  • Frantic search for South Korea ferry passengers continues

    Read more

  • Kiev powerless as pro-Russia activists seize armoured vehicles

    Read more

  • Algeria heads to the polls: ‘this election has nothing to do with us’

    Read more

  • Scandal-hit French doctor Jacques Servier dies

    Read more

  • N. Korea not amused by London hair salon's Kim Jong-un ad

    Read more

  • US rolls out red carpet for French critic of capitalism

    Read more

  • Real Madrid beat old foes Barcelona to lift Copa del Rey

    Read more

  • Belgian head of wildlife reserve shot in eastern Congo

    Read more

  • France's new PM targets welfare in drive to cut spending

    Read more

  • Campaigning against Bouteflika's re-election... in France

    Read more

  • Brazil club Mineiro cancel Anelka signing after no-show

    Read more

  • Syria 'torture' photos silence UN Security Council members

    Read more

  • Paris laboratory loses deadly SARS virus samples

    Read more

  • More than 100 schoolgirls kidnapped in northeast Nigeria

    Read more

  • New York police disband unit targeting Muslims

    Read more

  • 'Miracle girl' healthy after seven-organ transplant in Paris

    Read more

  • Paris police memo calling for Roma eviction ‘rectified’

    Read more

  • Burgundy digs into France's bureaucratic 'mille-feuille'

    Read more

  • French court drops ‘hate speech’ case against Bob Dylan

    Read more

  • Algeria rights crackdown slammed ahead of election

    Read more

  • Iraq closes notorious Abu Ghraib jail over security fears

    Read more

  • In ‘Tom at the Farm’, Xavier Dolan blends Hitchcock and homoeroticism

    Read more

Europe

UK economy slips back into recession

©

Text by News Wires

Latest update : 2012-04-25

Britain's economic outlook appeared gloomy on Wednesday after data revealed the country slipped back into recession. Under pressure from cutbacks and the eurozone crisis, the economy shrank 0.2 percent in the second quarter of 2012, figures showed.

AFP - Britain's economy sank back into recession in the first quarter, when it contracted by 0.2 percent amid ongoing state austerity and the eurozone debt crisis, official data showed on Wednesday.

The British economy has now returned to a technical recession, defined as two successive quarters of contraction, after shrinking by 0.3 percent in the previous three months, the Office for National Statistics (ONS) revealed.

The data confounded most analysts' expectations that gross domestic product (GDP) would grow by 0.1 percent in the quarter from January to March, compared with the final quarter of last year.

The ONS added in a statement that the decline in first-quarter GDP – the value of all goods and services produced by the economy – was driven by a poor performance by the construction and manufacturing sectors.

Britain's economy had clawed its way out of a record-length recession in the third quarter of 2009 following a downturn sparked by the global financial crisis.

But it has now returned to recession amid painful government spending cutbacks and fallout from the debt crisis in the neighbouring eurozone, which is a key trading partner.

Britain joins a number of eurozone countries in recession, including Spain, and bailed-out nations Greece, Ireland and Portugal.

Overall, the 17-nation eurozone's output shrank by 0.3 percent in the fourth quarter of last year, while recent weak data has sparked deep worries that the region is also back in recession.

Highlighting the extent of Britain's debt strains, official data on Tuesday showed public sector net debt as a percentage of GDP – excluding the cost of bank bailouts – hit a record high 66 percent in March.

Britain's total debt stands at £1.022 trillion (1.25 trillion euros, $1.65 trillion), the ONS had revealed.

"It's a very tough economic situation," British finance minister George Osborne said on Wednesday following news that Britain was back in recession.

"It's taking longer than anyone hoped to recover from the biggest debt crisis of our lifetime – even after the recent fall in unemployment.

"But over many years this country built up massive debts, which we are having to pay off. It's made much harder when so much of the rest of Europe is in recession or heading into it.

"The one thing that would make the situation even worse would be to abandon our credible plan and deliberately add more borrowing and even more debt," added Chancellor of the Exchequer Osborne.

The British pound fell against the euro and the dollar on Wednesday, but London's FTSE 100 index of leading shares held firm in positive territory.

The FTSE was 0.49 percent higher at 5,737.31 points in late morning deals.

"The double dip in recession comes as no surprise to us. We have been forecasting another recession since last November when the eurozone crisis intensified," said Schroders economist Azad Zangana.

The recession news dashed market hopes for modest first-quarter growth after retail sales rebounded by a strong 1.8 percent in March from the previous month.

Recent figures also showed that the number of jobless Britons fell by 35,000 in the three months to February, marking the first quarterly decline in almost a year.

 

Date created : 2012-04-25

  • ITALY

    Italy to miss pledge to balance budget by 2013

    Read more

  • EUROZONE

    Eurozone unemployment rate hits all-time high

    Read more

  • EUROZONE

    Eurozone boosts debt firewall to €800 billion

    Read more

Comments

COMMENT(S)