Britain’s businesses are standing firm as world-wide business sentiment takes a hammering from China.
UK business confidence over the three months to the end of September towered above the global average of 38 per cent at 67 per cent, down from the peak of 79 per cent in the previous quarter when businesses were buoyed by the General Election result.
According to Grant Thornton’s International Business Report, which surveyed more than 2,500 businesses around the world, UK businesses were less optimistic about export markets: only 12 per cent believe exports will increase over the next 12 months, down from 19 per cent the previous quarter.
Unsurprisingly, business sentiment in China plummeted, dropping 20 percentage points to 26 per cent.
Chinese concerns hit confidence in many of their main trading partners too: in Germany, where China accounts for 6.5 per cent of total exports, business sentiment dropped from 92 per cent 46 per cent.
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China represents a third of the Australia's export market, and confidence there was down to 39 per cent from 54 per cent, while expectations of increased exports fell to five percent.
Japan's business sentiment is now -28 per cent, sliding from just eight per cent.
Expectations for growth among the ASEAN (Association of Southeast Asian Nations) dropped to 31 per cent, while expectations for increase exports to the group's main trading partner China fell to zero per cent.
Simon Bevan, head of the China Britain services group at Grant Thornton UK, said:
Undoubtedly, businesses with an eye on the Chinese market will be watching the situation there closely, as the slowdown in China is a major concern for the global economy at a time of stuttering growth and heightened uncertainty.