Business Pivot Point

The last quarter of 2009 saw Britain moving back from recession. The next two years the relapse of the British economy may continue. The British government is facing the high risk of relapse the British chambers of commerce announced. The growth will be seen but will be a below average growth the BCC announced. The economic outlook of UK will be uncertain for certain time. The news was announced in the group’s latest economic forecast by BCC.

The relapse is very high and recovery is very fragile. The economy will see a growth of 1% for 2010 and the expansion of 2011 will be 2.1%. The economy has seen a shrink of 5% in the year 2009. The medium term recovery will be better and some obstacles are seen still. The next two years recovery will be modest and below the historical average BCC added. The fourth quarter of 2009 Britain had escaped from the waves of recession and a growth of 0.3% was seen.

The deep recession during the months of January to October 2009 is the longest in the country. The technical end of recession however happened but the complacency is dangerous. The director of BCC David Frost announced it on last Sunday. To maintain the recovery it is the vital role to be played by the government in wealth creation. A business lead recovery should be planned in the coming budget.

The time of recession is almost over and the economy in US is slowly recovering. The recession had seen many companies toppling down. Downsizing the employee force was seen as a measure of austerity and existence. Many people in US became jobless. Companies world over, had taken to reducing their operational cost as well. It would be apt to say minimizing rather than optimizing of operational cost.

People started finding ways to cut cost . That included reduction of stationary cost as well. When there is mention of stationary cost, then the cost of printers, their accessories and maintenance is not left behind. Companies started looking for low cost cartridges and cheap ink for their printers. They comprised their quality of printing and much to say, they minimized the usage of printer as well. Reports were circulated electronically via mail or a common interface. Resumes were scrutinized online.

There were cut downs on perks for employees, their yearly celebrations and privileges were cut down. The salaries of the existing employees were cut down into half. Now, the situation has lot improved. The companies started hiring more employees. But the other austerity measure remain the same. The companies want to keep the operational cost low , whether there is recession or not.

The oil prices have rose to $82 a barrel becoming the highest in the eight weeks, this Monday. US Crude were up by 59 cents and Brent crude were up by 65 cents a barrel. The New York crude rose more than 1 percent owing to the report that number of unemployed has decreased in February . The dollor value went down 0.2 percent facilitating other countries to get the oil cheaper. The Euro gained value. The gain in euro would help the Greece who is deep down in debt crisis. Greece was promised help from France and other euro zone countries, confirmed by the President of France.

The European Union Commission are discussing the options of launching a monetary fund in likeness to the International Monetary Fund to regulate the economic governance of the EU countries. The EU also said that it was considering a new rescue proposal to prevent the European countries to be affected by the financial crisis, like the one in Greece.

The top executives of EU said that the idea of framing a monetary fund for EU countries were put forth by President of Germany and they are in open discussions of the same right now. They are analyzing both favorable and against setting up of the monetary fu

UN Secretary-General Ban Ki-moon has visited a Chilean city badly damaged by last week’s earthquake and promised aid to help the country recover.

Mr Ban flew into Concepcion aboard a Chilean Air Force plane and was shown a 15-storey building that had collapsed, killing at least nine people.

As the clear-up continues, doctors have warned that debris piled up in towns and cities poses a health hazard.

The official death toll stands at 452 but hundreds are still missing.

“Remember that we are with you… our hearts are with you,” Mr Ban said in a brief statement in Concepcion.

People in Iceland are preparing to vote in a referendum on plans to repay debts owed to the UK and the Netherlands in the wake of Icesave bank’s collapse.

The British and Dutch governments want reimbursement for the 3.8bn euros (£3.4bn; $5.2bn) they paid out in compensation to customers in 2008.

Talks between the three countries broke down on Friday without agreement.

Iceland’s PM is urging voters to shun the “meaningless” referendum, called after the president blocked repayment.

The number of people for employment from the past week has increased rapidly. The people applying for insurance of unemployment have also gone up. The first time claims for this insurance showed rise in joblessness in US. The labor market is struggling as the recovery is not still in sight. The economic recovery is uneven as the market is struggling to rebound.

The applications have a sudden rise from 22,000 to 496,000 in the past few days. The weekend of February 20 showed the initial jobless increase. The survey was released by the labor department on Thursday in Washington. The number of people who attained the benefits of unemployment insurance gained. The number of people who availed the benefits of extended benefits decreased marginally.

The recession is one of the worst seen from 1930s the report said. Companies around the globe are excepting sustained sales. The increase in sale will benefit the employees adding to their payrolls. The manufacturers should help the US to come out of the recession. The average forecast of 9.8% of unemployment rate is seen in this year. Around 70 % of US economy is from housing and consumer spending.

Stimulus measures introduced to boost the Indian economy during the downturn will be reviewed, the government said as it unveiled its annual budget.

Indian federal finance minister Pranab Mukherjee said the measures had helped to maintain strong growth, but inflation must now be controlled.

The government also pledged to cut debt levels and review public spending.

The Indian economy is expected to grow by 8.7% in the current fiscal year, Mr Mukherjee added.

“The Indian economy now, is in a far better position than it was a year ago,” he said.

“The first challenge before us is to quickly revert to the high GDP growth path of 9%.”

India’s economy is recovering faster than expected - it grew at an annual rate of 7.9% in the three months to the end of September 2009, after growing 6.7% in the year to the end of March 2009.

Almost all economies seem to be recovering pretty fast now. It is the turn of the US now. The US economy grew at an annualised rate of 5.9% in the last three months of 2009, revised official figures have shown. The rate is higher than the first estimate of 5.7%.

The figures confirm the world’s largest economy is emerging rapidly from recession. According to economists, the rise was down to an increase in manufacturing output rather than stronger consumer spending. In fact, growth in consumer spending was revised down from 2% to 1.7% in the quarter. Manufacturing rose to meet the demand from retailers and businesses who had allowed stock levels to fall.

Business spending on equipment and software, for example, saw an 18.2% rise, while exports of US goods rose by 22.4% - the fastest pace in 13 years.

The UK economy grew by 0.3% in the final three months of last year, faster than previously estimated. The revision was due to stronger growth in services and production.

The initial estimate released last month said the UK economy had grown by 0.1% in the last quarter of 2009, meaning it had emerged from recession. However, the size of the overall contraction in gross domestic product (GDP) during the recession increased, from a 6% fall to a 6.25% drop. Prior to the October to December period, the economy had contracted for six consecutive quarters - the longest period since quarterly figures were first recorded in 1955.