The UK government has been coaxed to spend more on fund investment and "steer its economy back to recovery", by the International Monetary Fund (IMF).
After economic data highlighting that retail sales slumped in the UK in April, while a measure of public borrowing jumped to a record high, the IMF’s annual report urged Britain to consider slowing the pace of spending cuts aimed at reducing its hefty budget deficit.
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The IMF said the UK is still "a long way from a strong and sustainable recovery".
"Notwithstanding the recent uptick in activity, per capita income remains 6% below its pre-crisis peak, making this the weakest recovery in recent history. Of particular concern is that capital investment (as a share of GDP) is at a postwar low, and that youth unemployment is high."
According to the IMF’s suggestions, the UK should brings forward any planned infrastructure projects where possible, implement more growth-friendly measures such as reducing marginal effective corporate tax rates, and invest in supply-side measures.
It also recommends that the UK Government create a "clear strategy" to restore partly-nationalised banks RBS and Lloyds, to private ownership.
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