‘Sort out Brexit’ plea to MPs by the Swindon Initiative as economy is helped by stockpiling

May 13, 2019

The Swindon & Wiltshire Initiative has again called on Parliament to resolve Brexit and tackle the UK’s long-term economic challenges after new figures showed that stockpiling by manufacturers ahead of the UK leaving the EU had helped boost growth.

Figures from the Office for National Statistics (ONS) showed the economy expanded by 0.5% in the first three months of this year – up from 0.2% in the previous quarter. 

While the manufacturing sector grew at its fastest rate since 1988 during the period, the ONS said this was caused by factories trying to complete work ahead of the original March 29 Brexit deadline. Commentators have also said that stockpiling of goods in case supply chains were impacted by a no-deal Brexit had also boosted the manufacturing sector.

Ian Larrard, pictured, director of the initiative – which is part of the region’s largest business group Business West – said: “While there was a strengthening in UK GDP growth in the first quarter, the headline figure has been flattered by a temporary boost from stockpiling ahead of a possible no-deal exit, and so does little to alter the UK’s underlying growth trajectory. There was also a marked loss of momentum through the quarter from the strong January outturn to output contracting slightly in March.

“The latest data suggests that the UK economy remains imbalanced, with rising consumer spending set against a growing trade deficit. The UK’s net trade position is likely to remain under pressure over the near term as exchange rate volatility, Brexit uncertainty and the prospect of an escalating US-China trade war increasingly weigh on trading conditions for UK exporters.”

He said the pick-up in growth in the first quarter was likely to prove to be a high point for the UK economy this year, with the unwinding of stockpiles together with the relentless uncertainty and increasing cost pressures caused by the ongoing Brexit impasse likely to squeeze economic activity in the next couple of quarters.

“On behalf of our members we once again call on UK ministers and parliament to get on and outline a clear path forward on Brexit and do more to tackle the long-standing domestic challenges for the UK economy – from weak productivity, to a growing skills gap and the need to invest in transformative infrastructure projects that will boost growth across the UK,” he added.

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