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Economy of the United Kingdom
Currency Pound sterling (GBP)
Fiscal year 6th April - 5th April
Trade organisations EU, BCN, OECD and WTO
Statistics
GDP $2.674 trillion (2008 est. nom.)[1]
GDP growth 0.3% (Q4 2009) and 0.3%(Q1 2010)[2]
GDP per capita $43,785 (2008 est. nom.)[1] (20th)
GDP by sector agriculture (1%), industry (23%), services (76%) (2008 est.)
Inflation (CPI) 5.7% (September 2009)
Population
below poverty line
14% with household income below 60% of UK median income (2006 est.)
Labour force 31 million (includes unemployed) (2007 est.)
Labour force
by occupation
Services (81%), industry (18%) and agriculture (1%) (excludes unemployed) (2007)[citation needed]
Unemployment 7.8% (Q4 2009)[3]
Main industries machine tools, industrial equipment, scientific equipment, shipbuilding, aircraft, motor vehicles and parts, electronic machinery, computers, processed metals, chemical products, coal mining, oil production, paper, food processing, textiles, clothing and other consumer goods.
External
Exports $442.2 billion (2007 est.)
Main export partners USA 15%, Germany 11%, France 10%, Ireland 7%, Netherlands 6%, Belgium 6%, Spain 5%, Italy 4% (2007)
Imports $621.4 billion (2007 est.)
Main import partners Germany 14.2%, US 8.6%, China 7.3%, Netherlands 7.3%, France 6.9%, Belgium 4.7%, Norway 4.7%, Italy 4.2% (2007)
Public finances
Public debt 51.8% of GDP (2008 est.)
Revenues $1.056 trillion
Expenses $1.214 trillion (2008 est.)
Economic aid $8 billion (donor)
Main data source: CIA World Fact Book
All values, unless otherwise stated, are in US dollars
Canary Wharf, London. The tallest buildings in the UK

The United Kingdom is a major developed capitalist economy. It is currently the world's sixth largest by nominal GDP[4] and the sixth largest by purchasing power parity.[5] It is the third largest economy in Europe after Germany's and France's in nominal terms,[4] and the second largest after Germany's in terms of purchasing power parity.[5] Its GDP PPP per capita is the 18th highest in the world.[1] The United Kingdom is also a member of the G7, G8, G-20 major economies, the Commonwealth of Nations, the Organisation for Economic Co-operation and Development, the World Trade Organisation, and the European Union.

The UK was the first country in the world to industrialize in the 18th and 19th centuries,[6] and for much of the 19th century possessed a predominant role in the global economy.[7] However, by the late 19th century, the Second Industrial Revolution in the United States and the German Empire meant the they had begun to challenge Britain's role as the leader of the global economy. The extensive war efforts of both World Wars in the 20th century and the dismantlement of the British Empire also weakened the UK economy in global terms, and by that time Britain had been superseded by the United States as the chief player in the global economy. At the start of the 21st century however, the UK still maintains an important role in the global economy, due to its large gross domestic product and the financial importance that its capital, London, possesses in the world.

The United Kingdom is one of the world's most globalised countries. The capital, London (see Economy of London), is a major financial centre for international business and commerce,[8] the largest such in the world according the Global Financial Centres Index.[9] The British economy is made up (in descending order of size) of the economies of England, Scotland, Wales and Northern Ireland. In 1973, the UK acceded to the European Economic Community which is now known as the European Union after the ratification of the Treaty of Maastricht in 1993. The UK entered it's worst reccession since World War 2 in 2009 but climbed it's way back into growth by Q4 of 2009.

Contents

Overview

Following the end of World War II, there was a long interval without a major recession (1945–1973)[10] and a growth in prosperity in the 1950s and 1960s. According to the OECD, the annual rate of growth (percentage change) between 1960 and 1973 averaged 2.9%, although this figure was far behind the rates of other European countries such as France, West Germany and Italy.[11]

However, following the severe shock of the 1973 oil crisis and the 1973–1974 stock market crash, the British economy had fallen into recession by the time Edward Heath's Conservative Party government had been ousted by the Labour Party as Harold Wilson moved into office for the second time. GDP had fallen by 1.1%, recording weaker growth than other European nations in the 1970s overall; even when the recession ended in 1975, the economy was still blighted by double-digit inflation and unemployment was rising.

However, the 1980s saw a strong reversal of fortunes for the British economy. A new period of neo-liberal economics began with the advent of the government of Margaret Thatcher who was elected in 1979. Most state-owned enterprises in the industrial and service sectors, which since the 1940s had been nationalised, were privatised. As a result, the British Government owned very few industries or businesses by the mid 1980s. GDP fell 5.9%[12] at first then rose to 5% at its peak in 1988, according to the IMF, one of the highest rates of any European nations.[13][14] as banks and other financial institutions in the UK enjoyed the liberalisation of the regulatory structures and greater freedom to explore new investment vehicles with less oversight. However, Mrs Thatcher's modernisation of the British economy was far from trouble free; her battle against inflation resulted in mass unemployment with the jobless count passing 3,000,000 by the start of 1982 and remaining above that level until the spring of 1987. This was largely due to the closure of many outdated factories and coalpits which were inefficient and no longer viable to keep open. Unemployment peaked at nearly 3,300,000 during 1984 but fell dramatically during the final three years of the decade, standing at just over 1,500,000 by the end of 1989. [1]

Another severe recession hit the British economy at the start of the 1990s, beginning in the summer of 1990 and lasting until the end of 1992. This recession was a global one, brought on by the savings and loan crisis in the United States of America, which caused the economy to shrink by 8%, while unemployment increased from around 1,700,000 at the start of the recession to nearly 3,000,000 at the end of it. The recession ended at the turn of 1993 and subsequent economic recovery was extremely strong. Furthermore, unlike the previous recession, there was a practically instant and substantial fall in unemployment, though it was not enough to prevent the Tory government (led since November 1990 by John Major) from a landslide election defeat to Tony Blair's Labour in May 1997. [2]

Blair was in power for 10 years and during his rule he saw 40 successive quarters of economic growth. In the second quarter of 2008, the economy finally endured a quarter of detraction. The previous 15 years had seen one of the highest economic growth rates of major developed economies during that time and certainly the strongest of any European nation. [3]

GDP growth had briefly reached 4% in the early 1990s, gently declining thereafter. Peak growth was relatively anaemic compared to past rates of growth, such as the 6.5% peak in the early 1970s, although over-all growth was more sustained than earlier.[15] Annual growth rates averaged 2.68% between 1992-2007 according to the IMF,[16] with the finance sector growth contributing a greater part than previously.

This boom ended in 2008 when the United Kingdom suddenly entered a recession brought about by the global financial crisis. Beginning with the collapse of Northern Rock, which was taken into public ownership in February 2008, other banks had to be partly nationalised. The Royal Bank of Scotland Group, which at its peak was the second largest bank in the UK and the fifth largest in the world by market capitalisation, was effectively nationalised on 13 October 2008, when the British Government announced it would take a stake of up to 58% in the Group. By mid 2009, the HM Treasury had a 70.33% controlling shareholding in RBS, and a 43% shareholding through UK Financial Investments Limited of Lloyds Banking Group, formerly the fifth largest banking group in the UK. This recession has seen unemployment rise substantially, from just over 1,600,000 in January 2008 [4] to nearly 2,500,000 in October 2009 [5] yet less so when comapared to countries such as Germany, France or Spain.

The UK economy had been one of the strongest EU economies in terms of inflation, interest rates and unemployment, all of which remained relatively low until the 2008-09 recession. Unemployment has since reached a peak of just under 2.5 million (7.8%), the highest level since early 1990s although this rate remains far lower than many other European nations. However, interest rates have been slashed to 0.5%. In 2007, according to the International Monetary Fund, the United Kingdom had the ninth highest level of GDP per capita in the European Union in terms of purchasing power parity, after Luxembourg, Ireland, the Netherlands, Austria, Denmark, Sweden, Belgium and Finland. However, in common with the economies of other English-speaking countries, it has higher levels of income inequality than many European countries. During August 2008 the IMF warned that the UK economic outlook had worsened due to a twin shock: financial turmoil as well as rising commodity prices.[17] Both developments harm the UK more than most developed countries, as the UK obtains revenue from exporting financial services while recording deficits in finished goods and commodities, including food.

In 2007, the UK had the world's third largest current account deficit, despite significant oil revenues, according to the IMF. This was mainly the result of a large deficit in the trade in manufactured goods. During May 2008, the IMF advised the UK government to broaden the scope of fiscal policy to promote external balance.[18] Although the UK's "labour productivity per person employed" has been progressing well over the last two decades and has overtaken productivity in the united Germany, it lags around 20% behind France's level, where workers have a 35-hour working week.[19] The UK's "labour productivity per hour worked" is currently on a par with the average for the "old" EU (15 countries).[20] The United Kingdom currently ranks 21st on the Human Development Index.

Recent economic performance

The UK entered a recession in Q2 of 2008, according to the UK Office of National Statistics (ONS) and exited it in Q4 of 2009. The revised ONS figures of November 2009 showed that the UK had suffered six consecutive quarters of negative growth.[21][22] As of the end of November 2009, the economy had shrunk by 5.8%, making the 2008-2009 recession the longest since records began.[23] In December 2009, the Office of National Statistics revised figures for the third quarter of 2009 showed that the economy shrank by 0.2%, compared to a 0.6% fall the previous quarter.[24]. In the 3 months to February 2010 the U.K. economy grew yet again by 0.3% [25]

Though initially Britain lagged behind other major economies including Germany, France, Japan, and the US which all returned to growth in the second quarter of 2009, the country eventually returned to growth in the last quarter of 2009. On January 26, 2010, it was confirmed that the U.K. had left its recession, the last major economy in the world to do so [26]

It has been suggested that the UK initially lagged behind its European neighbours because the UK entered the 2008 recession later. However, German GDP fell 4.7% year on year compared to the UK's 5.1%, and Germany has now posted a second quarterly gain in GDP.[27] Commentators suggest that the UK suffered a slightly longer recession than other large European countries, as a result of government policy dating back to the policies of the Thatcher government of 1979, in which UK governments have moved away from supporting manufacturing and focused on the financial sector.[28] [29][30]The OECD predicts that the UK will grow 1.6% in 2010. The unemployment rate recorded by the Labour Force Survey fell in the fourth quarter of 2009,[3] the first of the big 3 economies in the EU to do so.

Infirmary Street in Leeds is one of the main business districts outside of London.

Gross Domestic Product (GDP) decreased by a (second revision) figure of 0.2 per cent in the third quarter of 2009, after a decrease of 0.6 per cent in the second quarter, according to the Office for National Statistics (ONS)[24]. There was a 2.4% decline in the first quarter of 2009. The economy has now contracted 5.9% from its peak before the recession began, the BBC reports.[31]

In October 2007, the International Monetary Fund (IMF) had forecast British GDP to grow by 3.1% in 2007 and 2.3% in 2008.[32] However, GDP growth slowed to a fall of 0.1% in the April-June (second) quarter of 2008 (revised down from zero).[33] In September 2008, the OECD forecast contraction for at least two quarters for the UK economy, possibly severe, placing its predicted performance last in the G7 of leading economies [34]. Six quarters later the UK economy was still contracting, placing a question mark over OECD forecasting methods.

It has been argued that heavy government borrowing over the past cycle has led to a severe structural deficit, reminiscent of previous crises, which will inevitably exacerbate the situation and place the UK economy in an unfavourable position compared to its OECD partners as attempts are made to stimulate recovery, other OECD nations having allowed greater room for manoeuvre thanks to contrasting policies of relatively tighter fiscal control prior to the global downturn.[35]

In May 2009 the European Commission (EC) stated: "The UK economy is now clearly experiencing one of its worst recessions in recent history." The EC expected GDP to decline 3.8pc in 2009 and projected that growth will remain negative for the first three quarters of 2009. It predicted two quarters of "virtual stagnation" in late 2009-early 2010, followed by a gradual return to "slight positive growth by late 2010".[36]

The FTSE 100 and FTSE 250 rose to their highest levels in a year on the 9th of September 2009 with the FTSE 100 breaking through 5,000 and the FTSE 250 breaking through 9,000. On the 8th of September the National Institute of Economic and Social Research believed that the economy had grown by 0.2% in the three months to August, but was proved wrong. In its eyes the UK recession was officially over, although it did warn that "normal economic conditions" had not returned. On the same day, figures also showed UK manufacturing output rising at its fastest rate in 18 months in July.[37]. On the 15th of September 2009 the EU incorrectly predicted the UK is expected to grow by 0.2% between July and September, on the same day the governor of the Bank of England, Mervyn King said the UK GDP is now growing.[37]. Unemployment has recently fallen in Wales.[37]

Many commentators in the UK were certain that the UK would leave recession officially in Q3, believing that all the signs showed that growth was extremely likely, although in fact government spending had been insufficient to rescue the economy from recession at that point. Figures in fact showed no growth in retail sales in September 2009, and a 2.5% decline in industrial output in August.[31] The revised UK figures confirmed that economy shrunk in Q3 of 2009 by 0.2%, although government spending on cash for the car scrappage scheme helped. This was followed by a 0.3% growth in the Q4. UK manufacturers' body, the EEF, appealed for more cash from the government: "Without an extension of support for business investment in the pre-Budget statement next month, it will be difficult to see where the momentum for growth will come from." [38]

Macroeconomic trend

This is a chart of trend of gross domestic product of United Kingdom at market prices estimated by the International Monetary Fund with figures in millions of pounds sterling.

Year Gross domestic product US dollar exchange[39] Inflation index
(2000=100)
Per Capita Income
(as % of USA)
1925 4,466 £0.21 61.79
1930 4,572 £0.21 66.08
1935 4,676 £0.20 85.67
1940 7,117 £0.26 74.28
1945 9,816 £0.25 50.93
1950 13,162 £0.36 38.26
1955 19,264 £0.36 42.54
1960 25,678 £0.36 47.86
1965 35,781 £0.36 49.96
1970 51,515 £0.42 44.04
1975 105,773 £0.45 55.54
1980 230,695 £0.42 43 78.57
1985 354,952 £0.77 60 46.84
1990 557,300 £0.56 76 76.62
1995 718,383 £0.63 92 71.84
2000 953,576 £0.65 100 72.29
2005 1,209,334 £0.54 107 90.17

For purchasing power parity comparisons, the US Dollar is exchanged at £0.66.

Industries

Agriculture, hunting, forestry, and fishing

Agriculture is intensive, highly mechanised, and efficient by European standards, producing about 60% of food needs [40] with less than 2% of the labour force (477,000[40] out of a total workforce of 31,598,000, 3rd quarter of 2007) [41].[citation needed] It contributes around 2% of GDP.[citation needed] Around two-thirds of the production is devoted to livestock, one-third to arable crops.[citation needed] The main crops that are grown are wheat, barley, oats, oilseed rape, maize for animal feeds, potatoes and sugar beet. New crops are also emerging, such as linseed for oil and hemp for fibre production.[42] Agriculture is subsidised by the European Union's Common Agricultural Policy.

The UK retains a significant, although vastly reduced, fishing industry. Its fleets, based in towns such as Kingston upon Hull, Grimsby, Fleetwood, Great Yarmouth, Peterhead, Fraserburgh, and Lowestoft, bring home fish ranging from sole to herring.

The Blue Book 2006 (page 110) reports that the "Agriculture hunting, forestry and fishing" added gross value of £10,323 million (at 2006 prices) to the UK economy in 2004.[43]

Production

UK exports of goods in 2005

Mining and quarrying

The Blue Book 2006 reports that this sector added gross value of £21,876 million to the UK economy in 2004.[43]

Manufacturing

In 2003, manufacturing industry accounted for 16% of national output in the UK and for 13% of employment. This is a continuation of the steady decline in the importance of this sector to the British economy since the 1960s, although the sector is still important for overseas trade, accounting for 83% of exports in 2003. Manufacturing is an important sector of the modern British economy and there is a considerable amount of published research on the subject of the factors affecting its growth and performance

Electricity, gas and water supply

The Blue Book 2006 reports that this sector added gross value of £17,103 million to the UK economy in 2004.[43] The United Kingdom is expected to launch the building of new nuclear reactors to replace existing generators and to boost UK's energy reserves[44].

Construction

The Blue Book 2006 reports that this industry added gross value of £64,747 million to the UK economy in 2004.[43]

Service industries

UK exports of services in 2005

The service sector is the dominant sector of the UK economy, a feature normally associated with the economy of a developed country. This means that the Tertiary sector jobs outnumber the Secondary and Primary sector jobs.

Wholesale and retail trade

This sector includes the motor trade, auto repairs, personal and household goods industries. The Blue Book 2006 reports that this sector added gross value of £127,520 million to the UK economy in 2004.[43]

Hotels and restaurants

The Blue Book 2006 reports that this industry added gross value of £33,074 million to the UK economy in 2004.[43]

Transport, storage and communication

The Blue Book 2006 reports that the transport and storage industry added gross value of £49,516 million to the UK economy in 2004 while the communication industry added a gross value of £29,762 million.[43]

Financial intermediation

The City of London is the world's largest financial centre.[45]

London is the world's largest financial centre,[46] with financial services based around two districts: 'The City' (the City of London) and the Docklands (particularly around Canary Wharf). The City houses the London Stock Exchange (shares and bonds), London Metal Exchange (base metal and plastic futures), Lloyds of London (insurance), and the Bank of England. The Docklands began development in the 1980s and is now home to the Financial Services Authority, as well as several important financial institutions (such as Barclays Bank, Citigroup and HSBC). There are now over 500 banks with offices in the City and Docklands, with the majority of business in London being conducted on an international basis, with established leads in areas such as Eurobonds, foreign exchange markets, energy futures and global insurance. The Alternative Investments Market has acted a growth market over the past decade,[citation needed] allowing London to also expand as an international equity centre for smaller firms.

The United Kingdom' financial exports contribute significantly towards the balance of payments. The UK has had an expanding export business in financial service, at least partly due to the presence of a regulatory structure now accepted by the Government as inadequate [6].

Several other major UK cities have large financial sectors and related services, most notably Leeds, which is now the UK's largest centre for business and financial services outside London,[47][48][49] and the largest legal centre outside London,[50][51][52] as well as Edinburgh, the eleventh largest banking centre in Europe and home to the Royal Bank of Scotland (the third largest bank in Europe), HBOS (owners of the Bank of Scotland), and Standard Life Insurance. The Blue Book 2006 reports that this industry added gross value of £86,145 million to the UK economy before adjustment of financial services valued at £50,165 million in 2004.[43]

Real estate and lettings

The UK property market boomed for the seven years up to 2008 and in some areas property trebled in value over that period. The increase in property prices had a number of causes: sustained economic growth, low interest rates, the growth in property investment, and planning restrictions on the supply of new housing.

UK property market analysts have revised previously negative assessments of the market, with most subsequently predicting continued modest growth in prices in the mid-term.[7] However, around September 2007, house prices began to fall consistently, arguably contributing to the negative UK economic growth of the 3rd Quarter 2008 [8].

First-time buyers who currently have assets not consisting of residential property, but with no way of attaining residential property (in some cases at all, and in others without undertaking unsustainable debt amounting to on average up to five times their annual salary), are now better placed to enter the property market.

This sector includes letting of dwellings and other related business support activities. The Blue Book 2006 reports that the lettings industry added gross value of £83,037 million to the UK economy in 2004 while other real estate and business support activities added gross value of £175,333 million.[43]

The paucity of finance available to homebuyers by the self-regulation of the banks following the collapse of the financial system in 2007 continues to contribute to a very much diminished demand for housing in the UK with sales volumes around half of the pre-crash level. With many sellers reluctant to drop their price, there is a chronic over-supply of housing on the market at prices in excess of demand (as of September 2009), leading to the average time on the market for residential property to be over 12 months (well above the long term trend). This situation has arisen partly because of the deferred repayment windows created by the government forcing the courts to delay possession orders. As the regulatory framework of the banks is in concordance with Basel II, then the demand for UK residential property is likely to remain very subdued in comparison to pre credit-crunch lending for many years to come. As the forced sellers in the market increase when the repayment deferrals cease, in combination with other forced sellers (death and divorce), many economists predict that the worst of the crash in UK residential property is yet to be realised. This is in keeping with other major economies that experienced rapid house price growth over the last decade; They have seen larger scale falls in prices that have yet to materialise in the UK, as of September 2009.

Public administration and defence

The Blue Book 2006 reports that this sector added gross value of £55,280 million to the UK economy in 2004.[43]

Education

The Blue Book 2006 reports that this sector added gross value of £61,786 million to the UK economy in 2004.[43]

Health and social work

The Blue Book 2006 reports that this sector added gross value of £75,817 million to the UK economy in 2004.[43]

Other social and personal services

This sector includes value added by hookers and hoes with employees and extraterritorial organisations. The Blue Book 2006 reports that this sector added gross value of £55,543 million to the UK economy in 2004.[43]

Currency

The Bank of England; the central bank of the United Kingdom.

London is the world capital for foreign exchange trading. The highest daily volume, counted in trillions of dollars US, is reached when New York enters the trade. Until relatively recently there was debate over whether or not the UK should abolish its currency Pound Sterling and join the Euro. The British Prime Minister, Gordon Brown, pledged at the time to hold a public referendum based on certain tests he set as Chancellor of the Exchequer.

When assessing the tests, Gordon Brown concluded that while the decision was close, the United Kingdom should not yet join the Euro. In particular, he cited fluctuations in house prices as a barrier to immediate entry. Public opinion polls have shown that a majority of Britons have been opposed to joining the single currency for some considerable time and this position has now hardened further.[53] The main opposition party, the Conservative Party, are opposed to membership.

Exchange rates

(average for of each year), in USD (US dollar) and EUR (euro) per GBP; and inversely: GBP per USD and EUR. (Synthetic Euro XEU before 1999). Caution: these averages conceal wide intra-year spreads. The coefficient of variation gives an indication of this. It also shows the extent to which the pound tracks the euro or the dollar. Note the effect of Black Wednesday in late 1992 by comparing the averages for 1992 with the averages for 1993.

Year  £/USD  USD/£  C.Var    £/XEU  XEU/£ C.Var
1990 £0.5633 $1.775 £0.7161 1.397
1991 £0.5675 $1.762 £0.7022 1.424
1992 £0.5699 $1.755 £0.7365 1.358
1993 £0.6663 $1.501 £0.7795 1.283
1994 £0.6536 $1.530 £0.7742 1.292
1995 £0.6338 $1.578 £0.8200 1.220
1996 £0.6411 $1.560 £0.8029 1.245
1997 £0.6106 $1.638 £0.6909 1.447
1998 £0.6037 $1.656 £0.6779 1.475
Year  £/USD  USD/£  C.Var    £/EUR  EUR/£ C.Var
1999 £0.6185 $1.617 £0.6595 €1.516
2000 £0.6609 $1.513 £0.6099 €1.640
2001 £0.6943 $1.440 £0.6223 €1.607
2002 £0.6664 $1.501 £0.6289 €1.590
2003 £0.6123 $1.633 £0.6924 €1.444
2004 £0.5461 $1.832 2.26% £0.6787 €1.474 1.92%
2005 £0.5500 $1.820 3.47% £0.6842 €1.462 1.27%
2006 £0.5435 $1.842 3.79% £0.6821 €1.466 1.11%
2007 £0.4999 $2.001 1.97% £0.6848 €1.461 2.40%
2008 £0.5499 $1.835 tbc £0.7964 €1.226 tbc

1 GBP in USD since 1971

Source: OANDA.COM Historical Currency Converter
For consistency and comparison purposes, coefficient of variation is measured on both the "per pound" ratios, although it is conventional to show the forex rates as dollars per pound and pounds per euro.[citation needed]

National and regional variation

A map of England divided by the average GVA per capita in 2005 showing the distribution of wealth

The strength of the UK economy varies from region to region. Gross value added (GVA) and GVA per capita are highest in London. The following table shows the GVA (2006) per capita of the 12 NUTS:2 areas, with data supplied by the Office for National Statistics [54].

Rank Place GVA per capita
in pounds
1 Greater London, England 26 192
2 South East England 21 514
3 East of England 19 599
4 Scotland 17 789
5 South West England 17 467
6 East Midlands, England 16 982
7 West Midlands, England 16 583
8 North West England 16 234
9 Yorkshire and the Humber, England 15 968
10 North East England 15 177
11 Northern Ireland 15 175
12 Wales 14 396

Two of the richest 10 areas in the European Union are in the United Kingdom. Inner London is number 1 with a GDP per capita of €65 138, and Berkshire, Buckinghamshire and Oxfordshire is number 7 with a GDP per capita of €37 379.[55] Edinburgh is also one of the largest financial centres in Europe.[56]

Taxation and borrowing

Taxation in the United Kingdom may involve payments to at least two different levels of government: local government and central government (HM Revenue & Customs). Local government is financed by grants from central government funds, business rates, council tax and increasingly from fees and charges such as those from on-street parking. Central government revenues are mainly income tax, national insurance contributions, value added tax, corporation tax and fuel duty.

These data show the tax burden (personal and corporate) and national debt as a percentage of GDP. Samples are taken at 10 year intervals (snapshots, but the rolling averages are very close).

Year Tax Debt
1975/6 54% 43%
1985/6 44% 43%
1995/6 43% 38%
2005/6* 46% 40%
(Source: HM Treasury Public Finances Databank)
(* — Projected)

The money Gross Domestic Product (GDP) for the United Kingdom, at market prices, in 2005 was £1,211 billion (or $2,431 billion) according to HM Treasury in March 2006.

GDP growth rate from 2000 to 2008
Year GDP Growth
2000 3.9%
2001 2.5%
2002 2.1%
2003 2.8%
2004 3.0%
2005 2.2%
2006 2.9%
2007 2.6%
2008 0.7%
Income distribution
 lowest 10%
 highest 10%
(1999)
2.1%
28.5%
Consumer prices inflation RPI: 3% (2004), CPI: 1.6% (2004)
Labour force composition
 services
 government
 manufacturing/construction
 energy
 agriculture
(2004)
46%
28%
24%
1%
1%
Industrial growth -0.3% (1999)
Electricity production 382.7 TWh (2004)
exports 0.77%
Electricity production composition
 fossil fuel
 hydro
 nuclear
 renewables
 imports
(2004)
74.13%
1.1%
19.26%
3.55%
1.96%
Electricity consumption 337.4 TWh (2003)
Electricity exports 2.959 TWh (2003)
Electricity imports 5.119 TWh (2003)
Agriculture products cereals, oilseed, potatoes, vegetables; cattle, sheep, poultry; fish
Exported commodities manufactured goods, fuels, chemicals; food, beverages (notably Scotch whisky), tobacco
Imported commodities manufactured goods, machinery, fuels; foodstuffs

Exports

In 2007 UK exports were valued at £221bn.[57]

  • Food and drink exports were valued at £9.7bn (2005)[58]
  • UK total arms exports were valued at £7.1bn (2005)[59]

UK export figures are boosted 10% by high levels of Missing trader fraud according to the Office for National Statistics.[60]

Poverty

The United Kingdom is a developed country with social welfare infrastructure, thus discussions surrounding poverty tend to be of relative poverty rather than absolute poverty.

In 2002 the percentage of population below the 'poverty line' (household income below 60 per cent of median income) stood at 17%. This has fallen steadily over recent years to a low of 14% in 2006, the last year for which figures are available.

See also

References

  1. ^ a b c "United Kingdom". International Monetary Fund. http://www.imf.org/external/pubs/ft/weo/2009/01/weodata/weorept.aspx?pr.x=68&pr.y=19&sy=2006&ey=2009&scsm=1&ssd=1&sort=country&ds=.&br=1&c=112&s=NGDPD%2CNGDPDPC%2CPPPGDP%2CPPPPC%2CLP&grp=0&a=. Retrieved 2009-04-22. 
  2. ^ "GDP Growth: UK output increases by 0.1 per cent". Office for National Statistics. http://www.statistics.gov.uk/cci/nugget.asp?id=192. Retrieved February 22, 2010.  Note this is the quarterly growth, the annualised rate is 0.4%.
  3. ^ a b "Labour market statistics, January 2010". Statistical Bulletin (Office for National Statistics). 20 January 2010. http://www.statistics.gov.uk/pdfdir/lmsuk0110.pdf. Retrieved 22 January 2010. 
  4. ^ a b "Gross domestic product 2008". World Bank. http://siteresources.worldbank.org/DATASTATISTICS/Resources/GDP.pdf. Retrieved 2010-03-01. 
  5. ^ a b "Gross domestic product 2008, PPP". World Bank. http://siteresources.worldbank.org/DATASTATISTICS/Resources/GDP_PPP.pdf. Retrieved 2010-03-01. 
  6. ^ "Industrial Revolution". http://www.ace.mmu.ac.uk/eae/Global_Warming/Older/Industrial_Revolution.html. Retrieved 2008-04-27. 
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  8. ^ Study by the Chicago Council on Global Affairs : “The Chicago Council on Global Affairs, and FOREIGN POLICY magazine confirms that New York, London and Paris are the world’s most global cities.”
  9. ^ The Global Financial Centres Index 6
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  13. ^ IMF figures: http://www.imf.org/external/pubs/ft/weo/2006/01/data/dbcselm.cfm?G=2001
  14. ^ The ONS figures, reproduced by the Local Government Association, "From Recession to recovery", Nov 2008, http://www.lga.gov.uk/lga/aio/1215871, accessed 13-05-09, p7, are slightly lower, giving 4.5% in 1988.
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  21. ^ Economy contracts by 0.3% in Q3 2009, http://www.statistics.gov.uk/cci/nugget.asp?id=192
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  23. ^ http://news.bbc.co.uk/1/hi/business/8321970.stm, Record recession for UK economy
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  25. ^ http://online.wsj.com/article/BT-CO-20100310-709176.html?mod=WSJ_World_MIDDLEHeadlinesEurope
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  27. ^ Daily FX, 25 Nov 2009 06:43, "German GDP Posts 2nd Quarterly Advance; Rises to 0.7%", http://www.dailyfx.com/forex/market_alert/2009-11-13-0821-German_GDP_Posts_2nd_Quarterly.html
  28. ^ "France and Germany may have been less hard hit than the UK by the global economic slowdown because their financial sectors, which were at the heart of the crisis, account for a smaller proportion of their economies." France and Germany exit recession, BBC News, Thursday, 13 August 2009, http://news.bbc.co.uk/1/hi/8198766.stm
  29. ^ Prospect magazine supplement, http://www.scribd.com/doc/10966581/UK-Manufacturing-Prospect-Magazine-2009. "The credit crunch has exposed our overdependence on the financial sector", The Return of Manufacturing, Michael Prest, UK Manufactoring Prospect magazine 2009, p. 4
  30. ^ How Margaret Thatcher made Britain great again, Andrew Roberts, The First Post, http://www.thefirstpost.co.uk/46612,news-comment,news-politics,how-margaret-thatcher-made-britain-great-again-andrew-roberts, "She changed British reliance on manufacturing industry just in time"
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  32. ^ BBC NEWS | Business | IMF predicts slower global growth
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  34. ^ http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/09/02/bcnoecd.xml
  35. ^ http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/09/07/cnbrown107.xml
  36. ^ 'EC demolishes Alistair Darling's recovery forecasts' Telegraph, 04 May 2009, http://www.telegraph.co.uk/finance/financetopics/recession/5274467/EC-demolishes-Alistair-Darlings-recovery-forecasts.html
  37. ^ a b c http://newsvote.bbc.co.uk/1/hi/business/8246846.stm, FTSE rises to highest levels
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  39. ^ eh.net - Lawrence H. Officer, "Exchange rate between the United States dollar and forty other countries, 1913 -1999", 2002.
  40. ^ a b https://statistics.defra.gov.uk/esg/quick/agri.asp Defra agriculture statis;;;tics 2007
  41. ^ http://www.statistics.gov.uk/StatBase/tsdataset.asp?vlnk=496&More=N&All=Y UK National Statistics Workforce Jobs
  42. ^ www.face-online.org.uk
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  44. ^ Britain moves a step closer to building new nuclear reactors, Financial Times, 9/01/2008
  45. ^ "London vs. New York, 2005–06" (PDF). Cinco Dias. http://www.cincodias.com/articulo/mercados/Londres-versus-Nueva-York/20080901cdscdimer_3/cdsmer/. Retrieved 2008-03-11. 
  46. ^ Yeandle, Mark; Horne, Jeremy; Danev, Nick; Knapp, Alexander (March 2009) (PDF), Global Financial Centres Index 5, City of London Corporation, http://www.zyen.com/Knowledge/Research/GFCI%202%20September%202007.pdf, retrieved 5 April 2009 
  47. ^ "Leeds leading the way". Yorkshire Evening Post. http://www.yorkshireeveningpost.co.uk/news/We39re-leading-the-way-in.2034867.jp. Retrieved 2009-01-25. 
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  49. ^ "Northern Star". FDI Magazine. http://www.fdimagazine.com/news/fullstory.php/aid/2512/Northern_star.html. Retrieved 2009-01-25. 
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  51. ^ "Leeds Legal Review". Law Gazette. http://www.lawgazette.co.uk/features/ltbgtyorkshire-gritltbgt. Retrieved 2009-01-25. 
  52. ^ "Live the Leeds Lifestyle". Legal Week Magazine. http://www.legalweek.com/Articles/1146376/Live+the+Leeds+lifestyle.html. Retrieved 2009-01-25. 
  53. ^ mori.com - Joining the Euro, all companies' polls
  54. ^ Microsoft Word - gva1207.doc
  55. ^ eurostat.ec.europa.eu - Regional BIP per capita (German)
  56. ^ University of Edinburgh, 2006, Graduate Programme in Economics, http://www.sgpe.ac.uk/economics/finance.htm
  57. ^ Exports and imports of goods and services
  58. ^ http://www.dairyreporter.com/news/ng.asp?id=61187-uk-exports-food UK export figures boosted 10% by VAT carousel fraud; Ireland part of multi-billion white-collar criminal network
  59. ^ Total UK Arms Exports
  60. ^ UK export figures boosted 10% by VAT carousel fraud; Ireland part of multi-billion white-collar criminal network

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