Sector can provide 'rapid economic growth' with right support
This comes as the International Monetary Fund (IMF) this week claimed the UK economy would contact 0.6% in 2023 rather than grow as was previously predicted.
However, this is particularly “frustrating” for the nations hospitality sector, which has proved it can generate “rapid growth with the right support”, according to UKH chief executive Kate Nicholls.
She said: “The IMF’s growth’s forecast is a frustrating reflection of the economic challenges that lie ahead for the country.#
Rapid growth
“Hospitality has proven it can generate rapid economic growth with the right support and investment, which I’d urge the Government to now commit to the sector.
“We saw this potential realised in November, where the sector was pinpointed as the main reason for unexpected economic growth.
“However, hospitality businesses in the UK find themselves hamstrung by loans they took out during the pandemic, unlike many of our European counterparts that benefitted from grants.”
The IMF predictions showed the UK economy would be the worst performing against other advanced economies including the USA, Germany, China and Russia, and was the only country expected to shrink this year.
IMF Growth Projections: 2023
— IMF (@IMFNews) January 31, 2023
USA : 1.4%
Germany : 0.1%
France : 0.7%
Italy : 0.6%
Japan : 1.8%
UK : -0.6%
China : 5.2%
India : 6.1%
Russia : 0.3%
Brazil : 1.2%
Mexico : 1.7%
KSA : 2.6%
Nigeria : 3.2%
RSA : 1.2% https://t.co/4ifKc9qi4j#WEOpic.twitter.com/qELAmtqXLP
Additionally, the financial agency cited high energy, costs, rising mortgage costs and increased taxes as well as labour shortages among the contributing factors to the nations predicted economic downgrade.
Thrive into the future
However, the IMF stated it expected the UK economy to grow 0.9% in 2024.
To aid future growth, Nicholls implored the Government to give hospitality the “urgent attention” it needs and relieve stress on cashflow for businesses.
She said: “The indebted nature of the sector needs urgent attention and I’d urge the Chancellor in his Spring Budget to direct banks to allow an extension of the CBILs repayment term by 10 years and instruct HMRC to offer greater flexibility on ‘Time to Pay’ in order to relieve stress on business cashflow.
“Implementing the right measures now can see the sector survive current challenges and also allow it to thrive into the future; delivering much-needed economic growth and job opportunities.”
