World Economy

UK Economy Reverses From “Hero to Zero”

UK Economy Reverses From “Hero to Zero”UK Economy Reverses From “Hero to Zero”

Economic data to be announced Wednesday are expected to reveal what Brexit critics have feared since the referendum over a year ago: the British economy has slipped into the slow lane, now rivaling Japan and Italy for bottom place in the 2017 Group of Seven growth table.

It will be the first time in a quarter of a century–since 1992 in fact–that it has occupied that particular position and marks a sharp slow-down from the stellar performance of the 2013-2016 period when it occupied first place, AFP reported.

There is, of course, basically one reason for it: the uncertainty and bickering surrounding the Brexit negotiations and the weakness of the Conservative government under Theresa May, the country’s increasingly hapless prime minister who appears out of her depth.

The figures are generally expected to record growth in GDP of 0.3% in the third quarter, which is pretty much in line with the previous two quarters, suggesting the economy is heading for growth of 1.2% in 2017. That is a deeply disappointing performance compared to the world economy which, according to the IMF, is enjoying its strongest growth since 2011. More worrying for the long-term, investment has fallen for the first time since 2009.

All three of the big economic regions that drive the global economy, the US, Europe and Asia, are growing strongly and even Japan is showing signs of stirring itself following Shinzo Abe’s landslide election win over the weekend.

The London stock market has been hitting new highs, too. But it is not being matched by the economic performance. The latest figures are expected to show that British growth has now halved from its three-year run between 2014 and 2016, reversing its position as the strongest performing major economy in the EU, from “hero to zero” in just 15 months.

The economic consequences of the Brexit vote are becoming more visible by the day, reflecting the growing uncertainty about the long-term position of Britain in the post-Brexit world.

Add new comment

Read our comment policy before posting your viewpoints