AS the national economy improves, huge untapped potential is just waiting to be unleashed in the Worcestershire business community, according to a new report.

The latest economic review from the Herefordshire and Worcestershire Chamber of Commerce also calls on the Government to boost the flow of lending to growing businesses to help the process.

Chamber chief executive Mike Ashton said: “The improvement in most key balances in the second quarter of 2013, building on the upturn recorded in the first three months of the year, supports our view that the UK economy is slowly strengthening.

“If recent progress can be sustained, there are realistic hopes that growth forecasts will be revised up further.

“The strength of the export balances, particularly in the service sector, confirms the existence of huge untapped potential that must be unleashed. But the economy’s performance is still inadequate and the recovery faces major risks.

“Global financial turmoil, as the US central bank is planning to reduce its stimulus and new problems in the eurozone, could have adverse effects on the UK.”

Mr Ashton also urged ministers to tackle the recent rise in domestic inflation.

“Unless rapidly reversed, it risks worsening the squeeze on businesses and consumers at a time when the Government must reduce the unsustainable fiscal deficit,” he said.

“In these difficult circumstances, it is vital that the Government takes the necessary steps to switch policy priorities towards growth enancing policies by supporting infrastructure investment and by boosting the flow of lending to growing businesses, while continuing to cut current spending in real terms.”

John Longworth, director general of the British Chambers of Commerce, said: “If we want Britain’s economy to be great, rather than just good, pro-growth policies will need to continue for decades to come. Otherwise, we may be in for a long and slow road to recovery, a prospect with little appeal for either business or government.”