BCC Economic Forecast: Long road to recovery after more than a year of recession

The BCC expects the UK economy to remain in recession for five quarters before an anaemic recovery in 2024, but inflation has likely peaked at 11%. 

In the immediate term, the BCC is now forecasting a five-quarter recession for the UK economy which began in Q3 of 2022. The annual expectation for GDP growth in 2023 is now -1.3%, broadly in line with the OBR and Bank of England’s predictions. However, unlike the Bank of England, the BCC expects the economy to grow in 2024, albeit at 0.7%, which is around half of the OBR’s forecast. 

A key contributor to the 2023 economic contraction is a sharp fall in household spending as consumers face rising energy costs, falling real wages, frozen income tax allowances and higher mortgage payments.  A poor outlook for the global economy means exports are also likely to fall, although they will be outstripped by a sharper decline in imports. 

The mini-budget in September 2022 is expected to have had a long-term impact on borrowing costs for both businesses and consumers. Alongside the effect of changes in corporation tax and business rates on already dwindling business confidence, this is likely to lead to a 3.0% contraction in firms’ investment in 2023.   

Businesses and consumers will continue to face high costs due to inflation, but the upward spiral is now thought to have peaked for Q4 2022. This is down from the previous BCC prediction of 14.0%, thanks in part to the Government’s energy price guarantee. The CPI rate is expected to slow to 5.0% in Q4 2023 and finally drop below the Bank of England’s target to 1.5% in Q4 2024. However, this simply means prices will stabilise at a very high level and Government plans to reduce energy support after April 2023 could put upward pressure on inflation again. 

The forecast for the Bank of England’s interest rate has changed dramatically following the mini-budget of September 2022; the rate is now expected to increase to 5.25% by Q4 of 2023. Although the impact of energy and raw material costs on inflation is likely to reduce in 2023, there remains a likelihood of upward wage pressure as workers seek to increase their income. 

Overall investment is expected to fall by 1.8% in 2023, with business investment expected to fall even further by 3.0% in 2023, down significantly from a previous prediction of a 0.6% increase. This follows recent BCC research showing significant falls in business confidence in recent months. Household consumption is also expected to fall by 2.3% although Government spending is expected to increase by  4.6%.  

The overall picture for 2024 shows a return to growth but not at a level which will compensate for the five quarters of a shrinking economy. Net exports, household spending and business investment will all return to positive growth but with government spending dropping, the recovery will by lacking in strength. 

Commenting on the forecast, Alex Veitch, Director of Policy at the British Chambers of Commerce, said:  

“BCC research has shown that business confidence has been falling for months. It is now clear that the September mini-budget and Autumn Statement have had a further chilling effect. Very few firms will be willing to invest as they face into a wall of higher prices, interest rates and taxes. The very real worry is that the UK will get left behind by our competitors, once the economy emerges from recession, as growth remains so weak. But it is not too late to turn this around. With concrete action on infrastructure investment, skills, trade, and green tech we can put the economy in a much stronger position. The next Budget, due in March 2023 will be a real acid test of whether the Government fully understands the scale of the problems ahead and is prepared to act. In the meantime, the forthcoming announcement on energy bill support for businesses will be watched closely by firms for signs that the Government grasps the size of the challenges they face.” 

Key points in the forecast: 

• UK GDP growth forecast for 2022 is 4.2%, -1.3% in 2023 and 0.7% in 2024 
• Following a contraction of growth in Q3 2022 by 0.2%, quarter-on-quarter GDP growth is forecast to continue to decline in Q4 by 0.9%, 0.3% in Q1 2023, 0.4% in Q2, and 0.2% in Q3, before a slight increase in growth of 0.1% in Q4 2023.
• Household consumption forecast is for growth of 4.7% in 2022, before shrinking by 2.3% in 2023, and growing 0.3% in 2024.
• Business investment forecast is to grow by 4.2% in 2022 before a 3% contraction in 2023, and then an increase of 1.4% in 2024 
• BCC expects export growth of 7.3% in 2022, -2.7% in 2023 and 0.4% in 2024, compared to import growth of 11.2%, -6.6% and 0% 
• BCC expects UK unemployment rate of 3.7% in 2022, before rising to 4.5% in 2023 and reaching 5.1% in 2024 
• CPI inflation is forecast to peak at 11% in Q4 2022, before slowing to 5% in Q4 2023. Inflation is expected to further slow to 1.5%, below the Bank of England’s 2% target, by Q4 2024
• UK official interest rates are expected to rise to 3% by Q4 2022 and then to 5.25% in Q4 2023, ending 2024 at 4.5%.

As the BBBA membership is growing, so is our team. We are excited to open a new position at the association. 

The British Bulgarian Business Association is a dynamic professional network promoting business relations between the United Kingdom and Bulgaria and has up to date over 240 members from all aspects of British and Bulgarian business. BBBA aims to provide a professional environment for business people and individuals who make up the British-Bulgarian business community, and the needs and interests of our members are at the core of everything we do.

We are looking for an experienced individual with excellent communication and events management skills to join our team on the position of Members and Partners Coordinator.

If you are energetic, motivated and result-oriented, excellent communicator and fast-learner, looking for a full-time job in a dynamic international business community, you might be the right person for this role.

Overview of the position:

Responsible for engaging BBBA members and partners in organised events, initiatives, meetings. Keeping track of new members and renewals, and actively supporting the recruitment of members, as well as communicating with the wider network of partners, local sectoral associations and clusters. Supporting all external communication aimed at members and partners.

Your responsibilities will include:

– Pro-actively communicating with potential and existing members 

– Leading existing and proposing new initiatives for enhanced membership engagement

– Organising the activities of BBBA committees 

– Working with the BBBA team for strengthening the value proposition to the different business sectors 

– Developing the BBBA network of partners – media, other bilateral and industrial chambers, sponsors, etc.  

– Ensuring clear BBBA membership internal and external communication

– Administrating member profiles on BBBA platforms

– Developing the broader BBBA business network, and engaging companies with good potential for the UK market

Requirements:

– Fluent written and spoken English

– Excellent communication skills

– Excellent knowledge of MS Office

– Experience with social media and web communications

– Ability to meet deadlines

– University degree, preferably in business, event management, philology, journalism, economics, management or marketing is desirable

– Minimum one year work experience preferably in a customer service or communications role. 

What we offer:

– Work in a dynamic professional network

– Opportunities for growth and development

– Attractive and contemporary centrally located office

If you are interested to join our team, please send your CV and motivation letter to: office@bbba.bg by 9 January, 2022.

We are delighted to introduce Isabel Videva- our new Events and Communications Trainee. 

Previously she studied in Austria, where she got her Bachelor’sDegree in Political Science and is now doing her masters in Diplomacy andInternational relations in Bulgaria.

She has a long-held passion for travellingabroad and is also an avid fan of skiing and photography. Isabel speaks acouple of foreign languages and hopes that this will help her work with peoplefrom all over the world.

In the future she would like to develop in the field of internationalrelations and use her professional skills in the political or business sphere. 

You can connect with her on LinkedIn here. 

We are overwhelmed with the positive emotions from St.Andrew’s Black Tie Ball organized by Singleton and the British Bulgarian Business Association. We would like to thank all guests for joining us for the most enjoyable Scottish celebration of the year. Special thanks to Moto Pfohe Bulgaria for supporting the event and for giving our guests the chance to seethe new Range Rover Sport.

Guests were greeted by the Great Highland bagpipe played by Bryce McCulloh. The Charlie Krikpatrick Ceilidh Band took care of the festive mood and for the dance floor. World top bartender Manol Lazarov prepared special Singleton whisky cocktails as a welcome drink. We also had a whisky tasting where guests had the chance to try three different aged varieties from the Singleton portfolio under the expert guidance of Nikolay Neykov, Brand ambassador of Diageo for the Bulgarian market.

All of this while supporting an honourable cause – ‘’TheGreat Teacher’’ charity aimed at improving the quality of education by empowering teachers and enriching their competencies. Thanks to everyone who supported the cause by taking part in a silent auction.

Special thanks to Gergana Stoyanova for being our lovely master of ceremony.

And last but not least- thanks to Hyatt for the warmhospitality and professionalism.

You may find photos from the event HERE.

Latha Naomh Anndra sona dhut! Happy St. Andrew’s Day!

Pavlos Trichakis is a partner at Baringa, Europe’s largest energy consultancy. He leads the Southern European energy advisory team, providing commercial, strategic and policy and regulatory advice to clients navigating the energy transition. He gave an interview with „Kapital “and was a guest at the Green Business is Great event organized by the British Bulgarian Business Association. 

You can read the whole interview here.

On Decemmber 6, we held the Green Business is GREAT conference for the second consecutive year. This year we focused on the hot topic of energy and energy efficiency. 

Guests had the opportunity to hear experts’ knowhow and a success stories panel of BBBA Members. We were joined by Mrs. Reneta Koleva, Deputy Minister of Environment and Water and H.E. Rob Dixon.

Special thanks to all our lecturers:

Special thanks to all our lectures:

• Pavlos Trichakis, Baringa
• Evgeniy Ivanov, Technology Transfer Office“Quasar’’
• Liliya Goranova, SeeNews

We would like to thank our Success Stories panel participantsand to our moderator Julian Mihov, PwC:

• Maya Atanasova, Atamiq

• Madlena Vladimirova, Vladimirova Consulting
• Ivan Armianov, Tangra
• Alex Daw, SGI
• Douglas Blackwell, Crowd House Energy

Last but not least we would like to thank Baringa, BritishEmbassy Sofia and Kapital for the support.

You may find photos from the event here.

Celebrate the festive season with Hyatt Sofia with their promotional offers.

• Only 4% of businesses comprehensively understand theRetained EU Law Bill and its potential impact on them. 71% know no details orare not aware of the Bill at all.
• When asked which regulations they would keep, amend, or remove completely, over half (58%) of businesses said they had no preference. 

• Across all business areas, approximately half of firms saidderegulation was either a low priority, or not a priority at all.
•  BCC calling for deadline on the REUL Bill to be extended until the end of 2026, with full reports needed on the impacts for trade within the UK internal market.
  
  A new survey from the British Chambers of Commerce of 938 businesses, mainly SMEs, has identified low awareness of the Retained EU Law (REUL) Bill among businesses, as well as low levels of priority for deregulation. 
• When asked how much they knew about the REUL Bill and its impact on them, only 4% of businesses said they comprehensively understood. A quarter (25%) knew some details, while 41% knew no details, and 30% were not aware of the Bill. 
• Firms were also asked whether deregulation was a priority for them across the business areas of employment, health and safety, environment, planning and product safety regulations.   
• Across all areas, around half said deregulation was either a low priority, or not a priority at all. 
• Employment, planning, and environmental regulations had higher levels of prioritisation among respondents. 19% of businesses said deregulation of employment regulations was a top or high priority, with 19% saying the same for planning regulations, and 18% for environmental regulations.  

By contrast, only 12% said deregulation was a top or high priority for product safety regulations. 

When asked which regulations they would keep, amend, or remove completely, over half (58%) said they had no preference. 14% specified a regulation to remove, 14% specified a regulation to amend, and 14% specified a regulation to keep.  

For those stating a regulation to remove, a range of rules were cited, from ‘employment’ regulations generally, to the proposed UK Conformity Assessed (UKCA) mark, IR35, as well as other planning and health requirements.  

William Bain, Head of Trade Policy at the BCC, said:  

“Businesses did not ask for this Bill, and as our survey highlights, they are not clamouring for a bonfire of regulations for the sake of it.  

“They don’t want to see divergence from EU regulations which makes it more difficult, costly or impossible to export their goods and services. 

“This Bill could also create divergence within both Great Britain and with Northern Ireland. For example, food and environmental legislation are devolved issues. Welsh and Scottish governments could easily decide to take a different path and bring forward their own legislation around things like the use of pesticides or food labelling.  

“In these circumstances, the Office of the Internal Market for trade within the UK would need to be heavily involved. 

“While removing barriers to SMEs’ growth would be welcomed, any proposals to amend or repeal thousands of pieces of retained EU law must be carefully examined and should not be rushed.  

“That’s why the deadline on this Bill must be pushed back to the end of 2026, to give everyone more time for the process to be consulted properly. Safeguards for businesses are also required, particularly for exporters and those trading within the UK so that additional barriers to doing business are not unwittingly created.    

“More widely, the UK Government must listen to businesses on all elements of the Bill and fully explain its rationale and the implications around which laws are expiring, being amended or repealed.    

“Most importantly, businesses and Government need to focus on the pressing issues we are facing right now. With a difficult 12 months ahead, we can’t afford to take away any resources that businesses need to keep afloat over the coming year.” 

Enjoy our special Christmas offers at The Revolutionary Dining Room and Bar! 

Let us do the cooking this Christmas Eve! We invite you to a special festive dinner showcasing the best of Bulgarian seasonal products and traditions from a revolutionary Italian point of view. Indulge in an unexpected vegan menu from Chef Luca Cabrini. You can order the full festive menu, as well as individual dishes from our regular menu. 

From 06:00 p.m. 

Price per person for a 3-course menu: 59 BGN 

We invite you to enjoy your Christmas Day with our Christmas brunch. Treat yourself and your loved ones to a lavish buffet of festive flavors specially created by our Revolutionary Chefs. 

From 01:00 p.m. 

Price per person: 79 BGN

For more information and reservations, please contact us at:

T: +359 88 6626 999 

E: TheRevolutionary@hyatt.com   

BBLF’s  prominent corporate social responsibility, sustainability and diversity contest will be held for the 20th time

We are happy to announce that the Annual Responsible Business Awards 2022, the first and foremost national competition for companies with a cause, are now open for applications!

The 20th edition of the prominent corporate social responsibility, sustainable development and diversity awards mottoed Lead by Example will champion corporate projects implemented in 2022 that benefitted people, the community and the environment. BBLF’s goal is to encourage best practice and promote corporate programmes with the biggest impact. By entering the contest companies have the opportunity to share their effective and inspiring CSR programmes, receive well-deserved recognition for their efforts and boost their reputation as a top employer.

BBLF’s Annual Responsible Business Awards will champion companies’ commitments in seven categories: Investor in the Community, Investor in Knowledge, Investor in the Environment, Investor in Human Capital and Working Conditions, Cause-Related Marketing, Best Social Policy of a Small or Medium Enterprise and Diversity at Work. The latter category was introduced a year ago by the Bulgarian Diversity Charter, and seeks to share best practice in building diverse teams and an inclusive working environment. 

One of all the entries will take the special Engage award for employee contribution to a social good project. By entering the competition, companies are also participating in BBLF’s national CSR platform.

The competition is open to all businesses regardless of industry and whether they are members of BBLF. They can enter their own applications, and they can also be nominated by their partners from the NGO sector, communications agencies, recruitment agencies, etc. 

Check out the terms and other details of the online application process on our web page here. Entering the Awards remains free of charge. The deadline for nominations is 15 January 2023.

„The Annual Responsible Business Awards, which BBLF is organising for the 20th time, are a prominent stage for companies with a cause. As challenging as 2022 may been for many of them, businesses have managed to give back to the community investing in programmes to the benefit of their people, the community and the planet. Our goal is to showcase and recognize many good examples of responsibility, sustainability and diversity in the workplace,“ BBLF Chair Levon Hampartsoumian said.  

The applications will be evaluated by an independent and unbiased jury of experts in various fields: business, civil organisations, public sector institutions, academia and the media, and the winners will be announced at a high-profile ceremony in spring 2023.