U.K. shows first recovery signs

Press, 14 November 1981, Page 9

U.K. shows first recovery signs

NZPA-Reuter London Britain showed the first signs yesterday that its battered economy could be climbing out of recession, reporting an encouraging growth in industrial production.

The production figures, which show a steady increase in output in the third quarter this year, bolstered the Prime Minister (Mrs Margaret Thatcher) when her tough economic policies are under heavy attack.

Mrs Thatcher sounded an optimistic note last week that Britain was on the brink of economic recovery. She told Parliament that Britons would see the difficult times behind them next year. Government statistics released yesterday showed both manufacturing output and total industrial production kept rising in September and were nearly half a per cent higher than August. In the third quarter from July to September, manufacturing output improved 1.5 per cent and over-all industrial production was up 0.7 per cent on the second quarter.

The Government spokesman at the statistician’s office said the figures pre-

senlecl fairly sound evidence that the recession was over.

The spokesman said the figures indicated the recession had "bottomed out” in the second quarter and that the worst of the recession was now over.

He said that the improved third-quarter performance “is not just a temporary blip.”

However economists are quick to point out that industrial production is still lagging behind last year. Mrs Thatcher has been under heavy pressure in recent months to abandon her tight monetarist policies. Critics complained that these were not driving down inflation fast enough and were driving unemployment up too fast, to near three million. But she insisted there would be no U-turn, saying her course was the right one to revive the British economy.

Mrs Thatcher has singled out British industry to lead the economic recovery. The latest figures showed output up 1.7 per cent in the food, drink and tobacco industry, 5.1 per cent in chemicals, coal, and petroleum products, 1.9 per cent in engineering and 1.0 per cent in North Sea oil and gas.