Is the UK economy really the worst in the developed world?
As we covered yesterday, the International Monetary Fund (IMF) has issued a suggestion that the US and the UK economies, taking out the oil-producing countries, are the weakest in the world. To put this into perspective, the UK government is expected to borrow 9.5% of GDP in 2009 which is equivalent to £140 billion although this will increase further in 2010 to 11% of GDP equating to borrowings of £160 billion.
Despite the denial by the UK government that the UK economy is one of the weakest in the world, the corresponding figures for America are 7.7% of GDP in 2009 rising to 8.9% in 2010, still significantly lower than expectations for the UK government. This has blown wide open the constant boasting by the UK government that the economy and the country as a whole is in a very good position to recover swiftly as and when economies around the world start to grow again.
While the IMF report and conclusions are well respected in the international monetary and investment markets, this is not the first report to suggest that the UK economy is significantly weaker than most developed countries. As they say, the proof is in the pudding and it will be interesting to see exactly how the UK economy performs when all around it begin to recover.
Share this..
Related stories
Bank of England considering extension of quantitative easing programme
The Bank of England is rumoured to be considering an extension of the quantitative easing programme with various meetings to be held this weekend. Despite the fact that £200 billion has been put to one side for the quantitative easing programme, which effectively allows financial institutions to swap assets for liquidity, it seems as though more money may be required in the short term. This would...
Read MorePolitical parties come together to fight the crisis
While the headlines may make interesting reading with the Tories criticising the Government, the Lib Dems criticising everyone and a general look and feel of conflict within politics, the reality at this moment in time is very much different. Thankfully, unlike in the US, it seems as though party politics will take second place to the task of ensuring the UK economy is protected with all parties...
Read MorePay deals steady
The number of pay deals above four per cent is increasing as inflation in Britain rises, a report by Income Data Services (IDS) shows.In the three months up to April, the average pay deal held steady at 3.5 per cent, the IDS survey found, yet the number of pay deals above four per cent continued to rise.Early 2007 saw the number rise from a quarter of all deals to more than a third in the previous...
Read MoreAre high street banks morally obliged to assist rural communities?
As more and more of the U.K.'s big banks decide to close branches up and down the country, there is growing concern that many rural areas are being left high and dry with banks ditching their moral obligation to assist local economies. This is not a new phenomenon but the onset of the worldwide recession has focused minds more upon cost-cutting than customer service and we are set to see more and...
Read MoreShanks receives bid approach from Carlyle Group
After months of speculation it has been revealed that waste management company, Shanks has received a bid approach from Carlyle Group of £1.35 a share. It is believed that Carlyle has made a number of approaches over the last few months but this is the only one which has been announced to the market with Shanks directors not sure whether the earlier approaches were "serious enough". It would a...
Read More