Coronavirus: UK economy to experience weakest growth since 2008 as BCC downgrades forecast

UK economic growth is likely to slow sharply this year as a result of disruption caused by the impact of coronavirus, according to the British Chambers of Commerce (BCC).

Adam Marshall, director general of the BCC, is pushing for 'real action’ to secure growth in the UK economy

The business group has downgraded its latest economic forecast for gross domestic product (GDP) growth in 2020 from 1 per cent to 0.8 per cent.

With the exception of the 2008/09 financial crisis, this would be the weakest full-year growth outturn since 1992 and a steep fall from economic expansion of 1.4 per cent last year.

The impact of Covid-19 is expected to weigh significantly on GDP growth in the first half, while a lack of clarity on the UK’s future relationship with the EU and other trading partners, as well as a struggling global economy, is predicted to limit the UK’s near-term growth prospects. The BCC forecasts business investment will contract by 0.7 per cent in 2020.

The group expects GDP growth to pick up in subsequent years, to 1.4 per cent in 2021 and 1.6 per cent in 2022.

Director general Adam Marshall said: “The Chancellor and the Bank of England have responded to the immediate challenge with measures to help firms hit by coronavirus, and they must now ensure this support gets to businesses as quickly as possible.

“Securing new trading arrangements, taking real action to reduce the high upfront costs of doing business and putting spades in the ground on long-overdue infrastructure projects must be prioritised in order to secure our long-term economic prospects.”