Confidence grows as region bounces back; Signs of recovery in Mersey economy: Company confidence highest for 18 months.

Byline: NEIL HODGSON 

NEW figures out today suggest the region is bouncing back from recession.

Leading accountants and business advisers KPMG said confidence among North West companies is at its highest for 18 months.

Its latest quarterly National Business Confidence Survey shows 56% of senior executives said they have seen signs of recovery in the economy - with 47% reporting "green shoots" in their own sectors.

The report found 19% of executives considered prospects for UK business over the next 12 months to be "good" or "very good" - more than double the number of directors viewing economic prospects so confidently in the previous quarter. At the opposite end of the scale, the number of company chiefs who view economic prospects as "bad" or "very bad" has more than halved, from 54% last quarter to 24%. Significantly only 21% of those quizzed expect a "double-dip" recession., where the economy slips back again before a sustained recovery. But KPMG senior partner in Liverpool Ian Goalen cautioned against too much optimism, warning the climb out of recession. will be long and slow, rather than a swift return to economic growth.

He said: "It's particularly interesting that in spite of certain economic indicators pointing towards modest growth in the third and fourth quarters of this year, the majority of senior executives do not expect the economy to come out of recession. for at least another seven to 12 months; perhaps because there is, as yet, no end in sight to falling consumer demand. "The vast majority of respondents believe the recovery will be long and slow, whereby we bob along the bottom of the cycle for three to five years before substantial growth is seen again." Mr Goalen also warned companies against trying to come out of recession. too quickly. He added: "The old adage that twice as many companies fail on their way out of recession. than do going into it certainly rings true.

"Over the past 12 months, companies have worked tirelessly to get to grips with their working capital with many firms destocking in response to declining demand. "The temptation to over-trade or scale up too quickly can be allconsuming after a lengthy period of inactivity, so there is a certain irony in the fact that this desire to 'get things back to normal' can often be the straw that breaks the camel's back. "Companies, therefore, need to resist the urge to go in with all guns blazing and instead keep up all those good habits that they have relied upon to see them through the downturn."

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Warning: Ian Goalen