The CBI has warned that falling business investment in the UK could do "irreversible damage" to the economy - causing job losses and denting companies' profits.
Director general Digby Jones called on Chancellor Gordon Brown to include measures in his budget next month to help tackle what he described as a "looming threat" to the economy.
According to CBI analysis based on figures from the Office for National Statistics, investment in assets such as buildings, machinery and equipment fell by 12.7 per cent in the past two years - outstripping falls in other G7 countries.
The organisation called for Mr Brown to extend existing measures to boost investment, including tax credits for research and development and capital allowances for smaller firms.
The CBI blamed the global economic downturn and sector specific investment during the dot-com boom of the 1990s but also said there was a "structural decline in profitability".
Comments: Our rules
We want our comments to be a lively and valuable part of our community - a place where readers can debate and engage with the most important local issues. The ability to comment on our stories is a privilege, not a right, however, and that privilege may be withdrawn if it is abused or misused.
Please report any comments that break our rules.
Read the rules hereComments are closed on this article