01-28-2009, 01:02 PM
By Aamir Ghauri
LONDON: Words pregnant with hope and promises of monetary support from the government and the opposition politicians are next to nothing for the British businesses as fears of bleaker times ahead are looming large over the country’s economic horizon.
Latest figures show that Britain is officially in recession and hallmarks of the British high street are being wiped out on daily basis. The economy contracted by 1.5 per cent in the final three months of 2008, the worst performance in more than 28 years, according to the Office for National Statistics.
And with the pound slumping to its lowest level against the dollar since 1985, hopes of even a slightest improvement is described as a madman’s dream. Retail icon Woolworths shut down its 807 branches after 99 years in business. Marks & Spencer, often described as the bellwether of Britain’s retail sector and pretty popular with the Pakistani, Arab and Asian communities, is also closing 27 stores and shedding more than 1,000 jobs.
The average house prices are slumping and according to Halifax, Britain’s biggest mortgage lender the trend could continue. The number of people out of work has climbed to nearly two million, a level not seen since 1997 when Tony Blair’s New Labour came to power.
Official statistics revealed that unemployment increased by 131,000 to 1.92 million in the three months to November to the highest level in more than a decade. In times where British high street and brand icons like Woolworths, Whittard of Chelsea and Wedgwood Waterford have gone into administration after roaring business spanning over centuries, Pakistani and Asian enterprises are feeling the heat too though not as hard as their hardcore British contemporaries. The saving grace is the nature of their businesses and a largely loyal ethnic niche market.
Muzaffar Chowdhry, a senior executive with the Bestway group, sees a “doom and gloom” period ahead for many businesses in Britain as “the worst is still to come”.
He said with pound sliding against major world currencies and a heavy import bill, Britain could only move from recession to depression.
Chowdhry, however, was not as bleak about the Asian businesses. “Most Asian and Pakistan business are either in grocery or retail sectors and come what may people will not stop eating.” Those in banking, travel, property, fashion and accessory businesses are bound to see their profits evaporate, he said.
Samiullah, the current president of the UK Pakistan Chamber of Commerce and Industry, could not agree more. Based in Oxford, he is associated with the aviation industry and has seen orders dry up over the last few months.
“The airline industry is one of the worst hit sector. People are cutting down expenses and traveling for pleasure is one of the first victims. The fluctuation in oil prices has also added fuel to fire,” he said.
With major airlines either delaying or canceling ambitious plans to augment their fleets, the industry is fast getting ready for a bumpy flight, added Samiullah.
Business body, the Confederation of British Industry (CBI) warned the recession was set to be worse than that of the early 1990s.
Charles Davis at the Centre for Economic and Business Research (CEBR) told the media that it was not just the fact that the UK has officially entered the recession that would cause concern; it is the size of the contraction.
“This supports our view that the economy is set for the steepest contraction in the post war era in 2009.”
There is no doubt that the hardest hit sector is international banking. Thousands of bankers have been laid off in the past few months in Britain, many of them are of Pakistani origin. But Pakistani banks in Britain are somehow saved from the savagery of international credit crunch.
Noman Dar, CEO of Habib Bank UK and head of the bank’s overseas operations, said they have been saved from the “direct impact” of international economic downturn. Admitting that many of his clients must have been affected in terms of mortgage repayments or credit squeeze, Dar does not feel hurt by the bleak economic climate.
And do Pakistani expatriates still send money back home through banks? Well yes. “In fact, there is a slight increment in remittances to Pakistan, may be due to the government action against some of the operators,” he said.
Pakistan International Airlines’ local chief, Farooq Ibrahim reports a similar situation.
“PIA has done better than the last year. There is growth in traffic from UK to Pakistan whatever the international perception of country. We have also been lucky that the fuel prices slumped, that has gone in our favour.”
http://www.thenews.com.pk/daily_detail.asp?id=159388
LONDON: Words pregnant with hope and promises of monetary support from the government and the opposition politicians are next to nothing for the British businesses as fears of bleaker times ahead are looming large over the country’s economic horizon.
Latest figures show that Britain is officially in recession and hallmarks of the British high street are being wiped out on daily basis. The economy contracted by 1.5 per cent in the final three months of 2008, the worst performance in more than 28 years, according to the Office for National Statistics.
And with the pound slumping to its lowest level against the dollar since 1985, hopes of even a slightest improvement is described as a madman’s dream. Retail icon Woolworths shut down its 807 branches after 99 years in business. Marks & Spencer, often described as the bellwether of Britain’s retail sector and pretty popular with the Pakistani, Arab and Asian communities, is also closing 27 stores and shedding more than 1,000 jobs.
The average house prices are slumping and according to Halifax, Britain’s biggest mortgage lender the trend could continue. The number of people out of work has climbed to nearly two million, a level not seen since 1997 when Tony Blair’s New Labour came to power.
Official statistics revealed that unemployment increased by 131,000 to 1.92 million in the three months to November to the highest level in more than a decade. In times where British high street and brand icons like Woolworths, Whittard of Chelsea and Wedgwood Waterford have gone into administration after roaring business spanning over centuries, Pakistani and Asian enterprises are feeling the heat too though not as hard as their hardcore British contemporaries. The saving grace is the nature of their businesses and a largely loyal ethnic niche market.
Muzaffar Chowdhry, a senior executive with the Bestway group, sees a “doom and gloom” period ahead for many businesses in Britain as “the worst is still to come”.
He said with pound sliding against major world currencies and a heavy import bill, Britain could only move from recession to depression.
Chowdhry, however, was not as bleak about the Asian businesses. “Most Asian and Pakistan business are either in grocery or retail sectors and come what may people will not stop eating.” Those in banking, travel, property, fashion and accessory businesses are bound to see their profits evaporate, he said.
Samiullah, the current president of the UK Pakistan Chamber of Commerce and Industry, could not agree more. Based in Oxford, he is associated with the aviation industry and has seen orders dry up over the last few months.
“The airline industry is one of the worst hit sector. People are cutting down expenses and traveling for pleasure is one of the first victims. The fluctuation in oil prices has also added fuel to fire,” he said.
With major airlines either delaying or canceling ambitious plans to augment their fleets, the industry is fast getting ready for a bumpy flight, added Samiullah.
Business body, the Confederation of British Industry (CBI) warned the recession was set to be worse than that of the early 1990s.
Charles Davis at the Centre for Economic and Business Research (CEBR) told the media that it was not just the fact that the UK has officially entered the recession that would cause concern; it is the size of the contraction.
“This supports our view that the economy is set for the steepest contraction in the post war era in 2009.”
There is no doubt that the hardest hit sector is international banking. Thousands of bankers have been laid off in the past few months in Britain, many of them are of Pakistani origin. But Pakistani banks in Britain are somehow saved from the savagery of international credit crunch.
Noman Dar, CEO of Habib Bank UK and head of the bank’s overseas operations, said they have been saved from the “direct impact” of international economic downturn. Admitting that many of his clients must have been affected in terms of mortgage repayments or credit squeeze, Dar does not feel hurt by the bleak economic climate.
And do Pakistani expatriates still send money back home through banks? Well yes. “In fact, there is a slight increment in remittances to Pakistan, may be due to the government action against some of the operators,” he said.
Pakistan International Airlines’ local chief, Farooq Ibrahim reports a similar situation.
“PIA has done better than the last year. There is growth in traffic from UK to Pakistan whatever the international perception of country. We have also been lucky that the fuel prices slumped, that has gone in our favour.”
http://www.thenews.com.pk/daily_detail.asp?id=159388