The latest economic news shows Japan, German and France coming out of recession. Stronger exports and consumer spending, as well as government stimulus packages, contributed to the growth.

Markets reacted positively to the news, with the main German and French markets up more than 1% at midday before later dropping back slightly.

In London, the FTSE 100 index also rose, with traders anticipating a positive effect on the UK economy, which by contrast shrank by 0.8% in the second quarter.

Asked about why the UK seemed to be lagging behind, Business Secretary Lord Mandelson said: “Different economies will show different patterns of behaviour.”

“But the key point is all these economies rely on each other; 55 to 56% of our trade is with the rest of Europe. So when [they are] recovering that is good news for our manufacturers and our exports here.”

France and Germany may have been less hard hit than the UK by the global economic slowdown because their financial sectors, which were at the heart of the crisis, account for a smaller proportion of their economies.

Overall the news is encouraging but caution and sound financial managment still remain key for small and medium businesses.

About the Author

Mark Higham

Is the Managing Partner at Numero Accountancy LLP and an ACCA qualified accountant. Having spent time working in large Plc's and Private Limited Companies in Senior Finance roles Mark start his own practice in 2005. In this time Mark has been a finalist in Doncaster Chambers Entrepreneur Year and Numero have been finalists in the Rotherham Chamber New Business Start-Up and Most Innovative Use of Technology Awards.

Posted on 21st July, 2010