Great Britain has retaken its position at the world’s fifth-largest economy, overtaking India, and is expected to massively outpace France in the coming years as it finally frees itself from the European Union.
Despite suffering from one of the deepest peacetime recessions — and years of anti-Brexit economic doomsday predictions — the Centre for Economic and Business Research (CEBR) forecasts that the United Kingdom will retain its economic lead over India until 2025, after which it will remain the sixth-largest economy through at least 2035.
Remain campaigners have consistently claimed that Britain would falter economically should the country regain its sovereignty from the European Union, as previous generations alleged in the 1990s and 2000s that the UK would need to join the Euro single currency in order to succeed financially.
However, the forecast from the CEBR predicts that Britain’s position as the second-largest economy in Europe will be unaffected by the departure or indeed by the pandemic, with British economic gains set to outpace France in the coming years, The Times reported.
“By 2035, UK GDP in dollars is forecast to be 40 per cent more than that of France, its long-standing rival and neighbour,” the CEBR said.
While coronavirus lockdowns in the UK have led to the deepest recession of any G7 nation, unemployment has remained lower in Britain than EU counterparts, with just 4.8 per cent unemployment in the UK compared to an average 8.4 per cent across the European Union.
The CEBR said that following the vaccine’s rollout, the UK economy would bounce back, benefiting from high savings rates amongst the public, translating into higher rates of spending once the shackles are removed from the British economy.
“My colleagues have calculated about £200billion of savings in the UK as a result of the pandemic that is waiting to be spent. There will be similar build-ups of savings elsewhere,” the deputy chairman of the CEBR, Douglas McWilliams, said.
“We are more worried that a rapid bounce-back will lead to inflation, with shortages pushing up prices,” he added.
The CEBR projected that the UK would see an average economic growth rate of four per cent, more optimistic than the British government’s own projections from the Office for Budget Responsibility (OBR) which estimated an average 3.4 per cent growth per year.
Mr McWilliams said that people often “forget that the UK’s largest economic sector is digital and creative”, and therefore is better suited than many countries to take advantage of the pandemic economically.
“We have a huge competitive advantage in this tech-based sector which the pandemic has kicked forward. Most of this is pretty Brexit-proof provided the UK continues to attract talented people,” he said.
The report offered a more sour prediction for the United States and China post-pandemic, however, projecting that the communist nation — the source of the global pandemic — will overtake the United States as the world’s largest economy by 2028, five years earlier than expected before the coronavirus crisis.
“The skilful management of the pandemic and the hits to long-term growth in the West mean that China’s relative economic performance has improved. We now think that the Chinese economy in dollar terms will overtake the US economy in 2028, a full five years earlier than we thought last year,” the CEBR said.
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