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Last Updated: Monday, 6 February 2006, 23:57 GMT
China 'main threat to UK economy'
Workers at a Chinese factory
China is seen as the biggest threat to the UK economy
The British people see China and India as the biggest challenges to the UK economy over the next five years, a Deloitte/YouGov survey has found.

In a study of public attitudes to global economic competition, 79% of 2,704 people identified fast-growing China as the largest threat to the UK.

India was seen as the main challenge to the UK by 45% of those surveyed.

A separate Deloitte report said the UK could fall from sixth to the 12th most competitive global economy by 2010.

'Public uncertainty'

China is seen as the biggest threat to the UK as its manufacturing sector continues to boom, while India now houses a number of call centres for UK firms.

The Deloitte/You Gov survey found that 64% of respondents expressed a negative reaction to such off-shoring, and a quarter also held the opinion that existing off-shoring programmes should be reversed.

Just 6% said they supported their continuation.

"The survey results clearly show the uncertainty that exists among the UK population when it comes to the growing prowess of India and China," said Deloitte's head of consulting, David Owen.

Mr Owen added that there "needed to be a great understanding among the public that the transfer of certain jobs to other locations is a trend that is likely to continue and brings with it opportunities as well as threats".

"UK located companies should benefit from, rather than be threatened by the increasingly global nature of the product and services markets," he said.

Start-up support

To help boost UK competitiveness, 75% of the survey's respondents said there should be greater investment in education and training.

A further 60% said there should be more support for small business start-ups.

"One possible way for government to raise skills is for tax credits to be awarded to businesses for training spend, similar to the incentives used to raise UK levels of innovation," added Mr Owen.

Deloitte's separate Trading Places report on the world's most competitive countries, put the US in first place, followed by Sweden, Finland, Denmark, Germany, and the UK.

By 2010 it estimates that while the US, Sweden, Finland and Denmark will keep their positions, South Korea will overtake Germany; and the UK will drop from sixth to 12th as it is overtaken by the likes of Canada, Japan, Switzerland and Austria.

Accountancy giant Deloitte called for more innovation, enterprise and investment to help prevent this decline.

YouGov is a market research company.


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