Britian, once the worlds 5th largest economy is not the 6th largest economy.
GDP forecasts by the International Monetary Fund in October back up this statement. According to those same numbers, France is the country who will replace them in the 5th spot. Using projections for 2018, France will widen the gap even more in the coming year. According to professionals, Britain leaving the EU can explain a good amount of this slip up, consumer spending has slowed and prices have hiked, hate to see it.
In the ensuing 3 years, Britain's expected growth is 1.5%, 1.4% and then 1.3%. The fact that Britain was replaced by an EU country in France does not look good for political leaders who said that Britain would be stronger apart from the EU.
This could be a direct effect of the EU exit, but could also be a mix of many things. Many countries who have the slightest thought of leaving the EU may rethink after seeing Britains growth slow year after year.
Here are the world's top seven economies, according to the 2017 IMF forecast:
- U.S. - $19.4 trillion
- China - $11.9 trillion
- Japan - $4.9 trillion
- Germany - $3.7 trillion
- France - $2.575 trillion
- U.K. - $2.565 trillion
- India - $2.4 trillion
I am not surprised by this, especially in light of many low-skilled workers from the EU leaving Britain post-Brexit. It serves to underline the point that following racist, populist policies is not only immoral, but negatively affects the economy and those living and working in the UK.
ReplyDeleteI agree with Madeleine, I was expecting a drop like this when hearing about Brexit. I think this directly correlates to the recent drop out of the top 5 for Britain.
ReplyDeleteYou really hate to see it. Like you said, France hopping over Europe (France being in the EU) does not look good for Britain. I do believe the Brexit caused an immediate impact, however, Britain should be able to bounce back (with their market size and past success). I intend on keeping a close eye on their economy compared to France's, I expect them to make up the miniscule margin they have behind France.
ReplyDeleteDo you think the downward trend for Europe will continue in future years?
Do you think Britain has plans on re-joining the European Union in future years, joining a different group, or remaining independent?
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Nick, I believe politicians in the UK are really kicking themselves because they know that the Brexit decision brought an economic downturn, however I doubt they will attempt to re-join the EU in the near future. I believe the politicians in the UK will not support re-joining the EU simply because of their pride. If they re-join then it will be accepting the fault. One thing that will be interesting to see now that France, an EU member, has passed up UK in the size of their economy is future opinions on the EU of member countries. There has been a lot of talk and uncertainty regarding the future of the EU, but I believe France surpassing UK in the size of their economy will strengthen the perception of the future of the UK and also deter other member countries from leaving the EU.
ReplyDeleteI agree with Aaron, the politicians in the UK are definitely starting to rethink the decision to leave the EU. However, I doubt they would try to get back in because it would make the UK look very dependent upon the EU. Although, right now, the UK does look like they will not be as successful without being a part of the EU, considering France (a country in the EU) surpassed them, and now has a bigger economy. The fact that the UK is expecting decreasing growth percentages for the next three years shows that the economy will not climb back up on the list of the top 7 economies. Like you said Antonio, you really hate to see it. I doubt any other countries will think about exiting after they see the way Brexit has impacted the UK.
ReplyDeleteAlthough Leaving the EU as an explanation for the switch it might not be that detrimental . If you look at the top ten economies in 2016 France and the UK economies differed but by very small margins. Its possible that the rising inflation is the UK is the reason for a slower economy.If the bank of England can figure out how to lower inflation and increase consumer spending i wouldn't be surprised to see UK retake that 5th spot.
ReplyDeleteLot of comments here, love to see it. Leaving the EU definitely hurt them, leading politicians to be reluctant to rejoin, and I think EU officials would skeptical as well. Regardless, we will see what Britain can do to bring their economy back up to the 5th spot. Whether that be talking inflation as Brady said, or increasing consumer confidence.
ReplyDeletethe U.K is only behind France in GDP by $0.01 trillion. Is it really that detrimental to their country? Their forecasted decreasing growth hurts them and its hard to say whether or not this is directly related to them leaving the EU. Interested to see how they bounce back.
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