World Economy

UK Says Economy Could Lose $420 Billion by 2030

UK Says Economy Could Lose $420 Billion by 2030UK Says Economy Could Lose $420 Billion by 2030

The UK economy could shrink by hundreds of billions of dollars by 2030 because of the impact of artificial intelligence and machine learning, according to a new study.

Research by The Economist Intelligence Unit last week illustrated a number of scenarios detailing the impact of advances in AI on world economies, CNBC reported.

In one scenario, human skills were complementary to AI, government investment in training workers increased, and all nations it analyzed benefited—albeit some more than others. In another, increased investment toward sharing data and advanced computing efficiency led to all countries' gross domestic product rising by at least 1%.

But in the third—and only negative—scenario, a lack of any upskilling or data sharing resulted in AI taking the jobs of humans. In this scenario, both Britain and Australia's economies suffered as a result, with the UK's becoming $420 billion smaller and Australia's losing $50 billion. The US and Asian economies continued to grow but significantly below expectations, the report said.

Although the report's authors said the near-term effect of AI would be "neither utopian nor dystopian," they warned that a lack of communication between developers, businesses and governments could worsen the consequences.

"There are many understanding gaps when it comes to AI, but one of the most important to bridge is that between developers and businesses and government institutions. The former are often only dimly aware of what the latter two really need, and the latter, in turn, are often only dimly aware of the potential solutions the former could provide," the authors of the study said. "A more robust and frequent exchange of information, capabilities and needs would help to remedy this."

They added that educating the public, investing in skills and training and more investment in research and development would be vital to alleviate any economic damage AI might cause.

Meanwhile, another research has revealed that Brexit could end up costing the UK economy £350 million ($469 million) a week—the same amount Leave campaigners promised the country would get back after exiting the EU.

The in-depth study by the Financial Times examines a range of economic estimates and predictions, including the value of Britain’s output, which is now around 0.9% lower than was possible if the country had voted Remain.

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