Britain scales down growth forecasts to "secure stability"
(dpa) - The British government Wednesday slashed its forecast for economic growth while insisting that Britain was "better placed" than other major economies to withstand the current global economic crisis.
Alistair Darling, the Chancellor of the Exchequer, said the economy would grow by between 1.75 and 2.25 per cent this year, compared with between 2 and 2.5 per cent predicted last October.
The core purpose of the 2008 budget was to secure stability in times of economic uncertainty, said Darling, pledging continued economic growth of up to 3 per cent by 2010.
Inflation, currently at 2.2 per cent, would remain above the government's target of 2 per cent this year but return to target in 2009.
Despite the crisis over mortgage lender Northern Rock, which was nationalized after being supported to the tune of 25 billion pounds (50 billion dollars), Darling insisted that the British economy was "more resilient and more prepared to deal with future shocks."
"In every country in 2008, every government has one aim - to maintain stability through the world economic slowdown," said Darling.
However, analysts said the Chancellor's growth forecasts were "still to high."
By blaming global market turbulence, sparked by conditions in the US economy, for the current crisis Darling was "skating over the fact that the British economy has serious problems of its own," said Howard Archer of Global Insight consultants.