Confidence in the rural economy is dramatically higher - and increasingly so - than confidence in the general economy, according to the second quarterly results of the Country Land and Business Association (CLA)’s Rural Economy Index (REI).

Only four per cent of those surveyed had no confidence at all in the rural economy over the next three to six months, while no-one has any confidence in the general economy in the short term, and an increased number - 69 per cent - has no confidence in the general economy at all.

The CLA’s REI is conducted quarterly to sample confidence in the rural economy, by surveying 100 CLA members involved in the rural economy.

Angus Collingwood-Cameron, director CLA North East, said: “The strong message here is that the confidence of rural businesses is up on our last set of results. The signs are that they are fending off the negative effects of the recession better than the rest of the economy.

“[Some] 58 per cent believe that their business performance will be in line with expectations over the next six months, with 12 per cent believing their business will perform well in the short term. A specific example is the increase in confidence in the rural tourism sector as bookings have increased prior to the holiday season. The weak pound helps the tourism sector, and it also helps the producers and primary processors of base commodities, such as food commodities and timber.

“However, we must not let these positive figures mask the problems we face. In many cases, the situation is simply less bad than elsewhere. There are businesses suffering. Lack of cash flow is a major obstacle to productivity, with lack of general spending and too much legislation also being mentioned. Some 87 per cent of respondents say that effective and affordable broadband is vital for rural businesses, and the CLA has led the way in lobbying for increased rural broadband coverage.”