A leading economist has told hoteliers gathered at the International Hotel Investment Forum in Berlin (IHIF) that the current recession is the "worst since World War II".
Bootle, who has been dubbed ‘Dr Death' for his economic predictions, was no more optimistic about the year to come, describing the recession as the "worst downturn for the global economy since World War II".
"All along people have failed to get the measure of this downturn," he told delegates. "It is fully global, and don't expect China to bail us out. The outlook is grim in China, with its economy predicted to grow by 4% this year, when it needs to grow by 10%."
Bootle went on to say that the UK would be one of the worst affected by the economic crisis, and that recovery would be slow, not arriving until late 2010 or early 2011.
"There has been a huge increase in government debt which means our debt position is thoroughly dreadful. The USA got off relatively lightly but the UK has been one of the worst hit, with Ireland in poll position," he said.
"This is not a normal economic downturn - I have never known bankers contact me to give them advice of whether or not something was safe. This is absolutely unique."
Bootle also recommended that the UK Government be more overt and comprehensive in its nationalising of the banking system, warning that the "bit by bit stealth approach" it has adopted was "confusing" and has not helped consumer confidence.
Predictions from the renowned economist included:
- 0% interest rates in the UK
- The Euro will weaken due to a poor policy response, compared to the UK and USA.
- An increase in buying and holidaying in the UK due to "unbelievably cheap" Sterling.
- A bout of deflation with a bounce back, early next year, into a period of low inflation.
By Gemma Sharkey
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