The economic slowdown as a global phenomenon is causing many countries that, a priori, were expecting solid growth, to now see their expectations moderated. This has happened to Germany, France, the United States and china itself. The case of the United Kingdom, which is also experiencing the effects of this economic downturn, is peculiar, given that uncertainty, regarding everything to do with Brexit has generated a strong impact.
According to October data on British GDP published by the National Statistics Office (ONS), the country is recording its lowest rate of expansion since 2012, standing at 0,7%. However, its economy has been slowing down since 2015, after a fantastic year in which it expanded by 2.2%. SInce then, in 2016 it expanded by 1.9%, in 2017 by 1.8% and in 2018 by 1.4%. Now, for 2019, it is forecast at 1.3%.
These growths in the British economy, although slight due to the context and economic situation, show a robustness similar to the average estimated for the European Union, between 1% and 1.2%. However, with the calendar in the hand, the truth is that, since the referendum in which the United Kingdom decided to leave the expansive cycle that was being experienced.
A decline in which, because of the Brexit and the uncertainty of a possible exit without negotiation, the British economy has been left behind for four years of growth. It is strength, being less dependent on factors such as demand and the external sector, has helped it to contain the declines. However, if we look at the trend, it’s clearly discouraging.
As doubts about the Brexit are cleared up, while agreement is expected, the forecasts are once again on the rise for the British economy. However, the slowdown it has experienced could be exacerbated if tensions once again rock the global economy, as recessions begin in the world’s major economies. A scenario that, this time, could indeed out the UK into the ropes.
Although it now denotes greater stability, it is still awaiting the exit process, which is limiting its potential, once again, because of uncertainty. It is expected to end in January, the date set by boris Johnson to leave the community block. However, everything is yet to be determined, since, although he is the favourite in the polls, he still has to win the elections on 12 December.
Uncertainty is limiting the growth potential of the United Kingdom economy
Even if uncertainties were removed, it is undeniable that the British economy has been negatively affected by Brexit. The question of whether or no a full study will be left pending, once the exit process is over, is one of the most important issues.However, the failure to meet all the forecasts for growth in excess of 2% shows the bill that the United Kingdom will have to pay for the mismanagement that has been taking so far.
One that has had a rather detrimental impact on the industry, the currency, as well as the set of indicators which make up the final economic activity, and that show this greater stagnation in the face of the conflict. If we add to this the precarious situation of the global economy, where the trade war and the anomalies of the end of the expansion cycle are combined, we have the perfect storm for the British economy.
The United Kingdom must therefore take decisions sooner rather than later in order to put an end to the uncertainty that is weighing down all the indicators. This country has a great capacity to grow, a solid and strong economy, but the bad management it suffers with the current president, as well as all the problems he already harvested with his predecessor, Theresa May, have ended up being a hindrance and leaving him stagnant.
