Economic statistic of the week

From Sean O’Gray in The Independent:

December 2010 is the first month in – probably – history where the UK’s manufacturing sector had more money on deposit than it borrowed from the banks. Or, to put it another way, industry is lending money to the banks, rather than the other way around. Bizarre.

Read more by or more about or .
This entry was posted in News.


  • toryboysnevergrowup 4th Feb '11 - 9:45am

    And why don’t you think that the corporate sector wants to invest – couldn’t be that they don’t believe what the Government says about future economic growth???

  • I think a major worry is that manufacturers may look abroad to joint local deals in the likes of India and China and that would eventually see not just a flight of capital from the UK but also following behind a loss of jobs as companies become used to operating in China and India.

    With interest rates as they are, manufacturers can’t invest here so from their point of view what do they do with this capital which will be eroded by increasing inflation if not put to use.

    This is why a real and strong growth policy is required and the timing of it is becoming more critical.

  • @EcoJon

    Actually, most of the offshoring that was going to be done has already been done.

    What is happening now to some extent is “onshoring”, where some companies are actually bringing production back here. I was interested by an article (“UK Manufacturing Reborn”) in the fashion industry magazine, Drapers, which says that even clothing production is coming back to the UK because of rising costs in China, increasing transport costs, quicker product lead times from manufacturing here and the prestige of the Made in the UK label in terms of quality. Obviously it is returning from a low base, but companies are now recruiting and expanding their facilities.

    Most companies basically project the future based on recent experience. The longer that recent experience carries on being positive, with rising output, the more they are likely to have the confidence to invest.

    Real and strong growth policy is needed, but it will not be put in place if the public finances are out of control.

  • john stevens 5th Feb '11 - 1:04pm

    Now would be a good time to switch from allowing interest payments to be deductable from pre-tax profits to dividend payments being so: a major step towards deleveraging our economy and encouraging venture capital.

Post a Comment

Lib Dem Voice welcomes comments from everyone but we ask you to be polite, to be on topic and to be who you say you are. You can read our comments policy in full here. Please respect it and all readers of the site.

If you are a member of the party, you can have the Lib Dem Logo appear next to your comments to show this. You must be registered for our forum and can then login on this public site with the same username and password.

To have your photo next to your comment please signup your email address with Gravatar.

Your email is never published. Required fields are marked *

Please complete the name of this site, Liberal Democrat ...?


Recent Comments

  • Steve Coltman
    I think the Lib Dems should be cautious about this by-election result. If the two main issues were HS2 and housing/planning the party is on dodgy ground. The pa...
  • David Raw
    @ John Marriott "Back in the days of the run up to GE ‘97, Paddy Ashdown thought he had Blair on his side regarding voting reform. However, when the latter...
  • John Marriott
    Could we possibly drop the adjective “progressive” for starters? “Alliance” would do for me. I agree with Brad Barrows’ sentiments. It HAS to be a com...
  • Tristan Ward
    Yes liberals should undoubtedly advocate free trade. It makes both sides of the trade richer than they would otherwise have been, bringing wealth to the poo...
  • Paul Barker
    This article is both confused & confusing. There is No possibility of any Electoral pact with Labour (unless Labour back Electoral Reform ) & I dont se...