Barclays has announced an additional £500 million of lending to be made available to the UK manufacturing sector, in support of its view that the sector will see improved performance during 2006.
Recent business surveys indicate an improvement in both domestic and export order-books after a period of weakness last year. The additional lending will target companies across all manufacturing sectors, along with new market ‘hot-spots’ such as initiatives to support employee retention, which is one of UK manufacturing’s biggest concerns.
Andy Martin, national director for manufacturing at Barclays, said, “We are delighted to announce this lending boost to the sector. On-the-ground sentiment among UK manufacturers points towards a revival in the sector’s fortunes, and this lending decision supports that conviction. We are targeting well-run, successful companies that are keen to invest for the future, and can successfully meet the current market challenges when supported with the appropriate financing.”
The additional lending is expected to be spread across all regions of the UK and the different industry sub sectors, including energy, construction, food production, chemicals, pharmaceuticals, aerospace and automotive.
Nick Brayshaw, chairman of the CBI’s National Manufacturing Council and chairman of Barclays’ Manufacturing Industry Strategy Board, said, “This announcement is a vote of confidence in the strength of UK manufacturing, which has proved its resilience during the difficult times experienced over the course of the past year. Last year Barclays provided additional lending to the sector, which was very well-received, and I’m sure this will be the case again this year.”
A recent Barclays business banking survey found that nine out of ten UK manufacturers remain optimistic about prospects for their sector, despite recent tough market conditions. The survey found that over three quarters of manufacturers reported order books at either normal or above normal, and that more than one in two manufacturers expect to spend 5 to 10 per cent of their turnover on capital investment during the next year.