Capital recovering from terror shock

DOWN but not out is the message from London firms in the wake of the 11 September terrorist attacks on the US, according to business organisation London First.

Optimism about prospects for growth and employment has dived to its lowest since the Asian financial crisis of 1998, but is still much higher than it was then. Many companies have put investment decisions on ice until at least Christmas because of uncertainty about the economy's outlook. But most firms are reporting business as usual.

Jo Valentine, London First's chief operating officer, said: 'The immediate and unanimous reaction to the attacks was of extreme pessimism for London. The prime rental market dried up immediately and earlier fears of recession seemed immediately closer to home. It is now important that London picks itself up, dusts itself down and gets on with it.'

London First found that in the immediate aftermath of the attacks shoppers shunned the West End, but have returned and there is no evidence to suggest that sales are worse than they were before the attacks. Other sectors cited by London First as being in the doldrums include technology, airlines and property development.