The CLA is launching this quarterly economic indicator because the rural economy is often overlooked, despite the small businesses that operate in the countryside being the backbone of this nation's economy as a whole.

Henry Aubrey-Fletcher - Country Land and Business Association

BUSINESS confidence in rural areas is still high despite the doom and gloom that has descended on the urban business community, according to an authoritative survey carried out by the 36,000 strong Country Land and Business Association. And farmers are also confident after an apparent change of heart in government policy.

The CLA's new rural economy index (REI) shows that only 5% of its members - many of whom run non-farming businesses in the countryside like hotels and professional services - have "no confidence" in the economy over the next three to six months, compared with 42% of the population in general.

And although 61% said they were "not very confident" a hefty 50% believed they would meet their business plan targets - and a substantial 16% expected their businesses to perform well or expand.

CLA President Henry Aubrey-Fletcher said: "The first findings of the CLA REI have been surprising with only 66 percent of respondents stating that they feel not very confident or have no confidence at all in the rural economy compared to a more expected 97 percent when asked the same question about the economy in general.

"The CLA is launching this quarterly economic indicator because the rural economy is often overlooked, despite the small businesses that operate in the countryside being the backbone of this nation's economy as a whole."

The survey coincides with a growing feeling of optimism amongst farmers after a speech last week by Defra secretary Hilary Benn expressing his determination to protect British "food security" - the ability of our farmers to produce more of the nation's food.

Since its foundation after the foot and mouth debacle, farmers have feared that Defra was more interested in environmental concerns than in actual food production. But the fall in the value of the pound, and increased competition by the growing middle classes in India and China, has meant that Britain is no longer a prime market for foreign food producers.

Mr Benn's speech, says the CLA, is an important "change of heart" and a "victory for CLA lobbying."

Full details of the REI survey can be found on www.cla.org.uk/Policy_Work/Rural_Economy_Index/