Outlook improves but area slips down the rankings

Data from analysts Experian Business Strategies (EBS), forecasts growth from now until 2006 will average 1.6 per cent, compared with 1.3 per cent in the previous five years.

Despite that improvement, the Tees Valley and Durham has slipped seven places in a league table of economic performance, and now features among the tail-enders of Europe.

The area is ranked 191st out of 204, compared with 184th last year.

Experian claims the apparent paradox of improved growth, but lower ranking, has arisen because other areas of the UK and Europe are set to grow at a faster rate.

For instance, Northumberland and Tyne and Wear is set to almost double its growth rate to 2.3 per cent a year, rising 58 places up the league to 127th as a result.

North Yorkshire, meanwhile, is ranked at 163 in the table, with growth of 1.9 per cent predicted, a rise up the table of eight positions on its previous best.

Anthony Light, senior analyst at EBS, said: "The Tees Valley and Durham has slipped seven places and is now ranked among the tail-enders, despite its improved prospects for growth.

"Some of the best results come from 'middle England', with places like Lincolnshire, Leicestershire and Northamptonshire, predicting significant improvements in output growth and rankings.

"London and the southern regions have been expanding strongly over the last few years, so it is not surprising to find their growth rates are set to slow to more sustainable levels. But even allowing for some slowing, which will affect their rankings, most are expected to remain in the top half of the table."

The Experian survey also shows that the wealth created by people of working age in the Tees Valley and Durham area is also set to fall.

In terms of GDP per head of working age population, the area will rank 160th in 2006, compared with 153 last year and 142 in 1996.

Meanwhile, Northumberland and Tyne and Wear will rank 163 in 2006, compared with 158 last year and 152 in 1996.