The UK economy continued growing in the fourth quarter of 2010, with a strong performance in the manufacturing sector, said the latest Quarterly Economic Survey from the British Chambers of commerce (BCC).
However, Q4 growth was at a slower pace compared with the previous two quarters, while the services sector remains fragile.

If the UK private sector is to drive growth during 2011, the Government must act forcefully to support businesses, said the report.

The figures suggest that manufacturers are still confident of increasing their expected turnover and profitability in 2011, with turnover confidence moving down one point to +48%, staying close to a three-year high.

Profitability confidence increased seven points to +30%, the highest level since Q4 2007.

Meanwhile, the manufacturing export sales balance soared 13 points to +37% and the export orders balance surged 21 points to +39%, the strongest results since Q4 1994.

BCC director general David Frost said: "UK businesses have witnessed some of the toughest years in recent memory. Our latest economic survey points to some encouraging signs among UK firms, particularly in manufacturing. However, as the figures for the service sector show, we're not out of the woods yet. Faced with the public sector cuts and cost pressures, ensuring the health of UK businesses is critical to a sustained economic recovery.

"We must encourage more new start-ups, more employment, create stronger companies and support export potential. While the BCC's survey points to our economy recovering, we call on the Government to take concerted action now to ensure recovery continues. Only a clear growth strategy set alongside existing plans for deficit reduction, will give businesses the confidence to grow through 2011 and beyond."