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Half of UK manufacturers worried by China, some review plans - EEF

Published 30/08/2015, 00:13
© Reuters. Apartment towers are seen in the southern Chinese city of Shenzhen

LONDON (Reuters) - Just under half of British manufacturers are worried by the possibility of a sharp slowdown in China's economy and one in ten are reviewing their business plans, a survey from an industry group showed on Sunday.

EEF said 47 percent of manufacturers were concerned by signs of a slowdown in China, which have rocked financial markets over the past week.

Big manufacturing firms were most likely to be worried, and also more likely to be looking at their business plans to take into account different scenarios, the survey showed.

"Overall, UK factories send only a small proportion of their goods to Chinese customers, but a sharper slowdown would also see a halt to growth in export sales through supply chains in Europe," said Lee Hopley, EEF chief economist.

"The more widespread impact, at least in the near term, is likely to be the knock to already delicate confidence levels. Time will tell whether this takes a further toll on growth across the sector."

EEF said the most directly exposed manufacturing sectors were road vehicles, which account for 16 percent of exports to China, followed by metal working machinery and leather goods.

The survey of 284 companies also showed just over a fifth of manufacturers were still worried about a re-escalation of Greece's crisis.

© Reuters. Apartment towers are seen in the southern Chinese city of Shenzhen

Manufacturing has been one of the weak spots of Britain's strong economic recovery this year. Official figures last week showed manufacturing output slipped 0.3 percent in the second quarter as the economy overall expanded 0.7 percent.

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