REGIONAL stock exchanges and markets should be introduced to the UK, according to a new report.

The idea was the key recommendation of a study by Robert Huggins Associates, an economic think-tank and consultancy specialising in competitiveness research.

The State of Urban Britain report found a growing divide between the competitiveness of the cities and metropolitan areas of London, the South-East and Eastern regions, and those in the rest of the UK.

The report benchmarks competitiveness at three levels - 56 city areas, metropolitan boroughs and urban wards.

The upper rankings of the UK City Competitiveness Index 2002 are dominated by the central London boroughs, with 11 entries among the top 20 performers, led by the City of London and City of Westminster.

Sunderland is the lowest ranked city, with Newcastle 34th.

Outside London, only three boroughs perform above the UK average. The northern metropolitan counties, including South Tyneside, prop up the bottom of the list.

Dr Robert Huggins, chief executive of Robert Huggins Associates, said: "We urge the Government and its agencies to seriously assess the potential for establishing a series of regional stock exchanges and markets throughout the UK."