Brexit Britain’s economy soars ahead of France’s as world league table announced | Politics | News


Boris Johnson and Emmanuel Macron

The British economy is predicated to be 16 percent bigger than that of France by 2036 (Image: Getty)

Booming investment in high technology industries is expected to help the UK’s business growth outstrip that of its neighbour and historic rival on the other side of the Channel, says the annual survey from the Centre for Economics and Business Research (CEBR). And the UK continues to benefit from the economic reforms carried out under Margaret Thatcher’s government in the 1980s, according to the research.

London city skyline

The UK has the world’s fifth-largest economy (Image: Gary Yeowell/Getty)

This year’s World Economic League Table estimates that the UK has the world’s fifth-largest economy with a gross domestic product of around £36,357 per head of population.

The report predicts Britain will drop to sixth position in the league table behind India in 2026.

France, currently the globe’s sixth-largest economy, is predicted to fall to seventh position next year and remain in that position for the foreseeable future.

The research is to boost British financial institutions in the competition with France to attract highly-qualified staff.

According to the CEBR research, a strong global recovery from the Covid pandemic and rising inflation will mean that world GDP is set to surpass 100 trillion US dollars for the first time in 2022.

The benchmark is set to be met two years earlier than the think tank predicted a year ago.

Slower growth in China following the covid pandemic is also highlighted by the report.

Last year, the CEBR predicted China’s economy would overtake the UK in 2028 but is now revising that expected date to 2030.

India, after overtaking France and the UK in 2019, has fallen back behind the UK in 2020 and further behind France in 2021.

The Asian giant is expected to regain 6th position from France in 2022, before overtaking the UK in 2023, a year earlier than the CEBR predicted 12 months ago.

India is then expected to make good progress towards becoming the world’s third-largest economy in 2031, the think tank says.

Indonesia, the fourth most highly populated country in the world, is set to become the largest economy on the planet in 2036.

Ho Chi Minh City skyline

Vietnam has the fastest-growing economy (Image: Alex Robinson Photography/Getty)

The fastest-growing economies in this year’s World Economic League Table are those of Vietnam, heading from 41st place in 2021 to 20th place in 2036; Bangladesh heading from 42nd to 24th and the Philippines from 37th to 25th.

This year’s CEBR report also warns that climate change is starting to have a significant impact on the world economy.

Storms, floods, forest fires and other climate-related events are increasingly imposing costs on insurers.

Spending to decarbonise the world economy is also expected to have an impact on the cost of living.

The CEBR estimates additional costs to consumers globally of around two trillion US dollars a year on average over the forecast period to pay a share of the net additional investment in low and zero emission production methods.

Kay Daniel Neufeld, director and head of Forecasting at CEBR, said: “One of the features of this new forecast is its environmental focus.

“The range of extreme weather events this year has highlighted environmental concerns which concluded with the pledges made at COP26.

“To achieve the ambitious goal of decarbonising the world economy by the middle of the century all countries need to step up their efforts. Importantly, we have identified nearly 700 companies out of the world’s top 2,000 who have made net zero pledges, in many cases for 2030 or earlier.

“We estimate about five trillion dollars a year in additional investment in decarbonisation will be required, though some of this will substitute for other investment.

“Of this, around two trillion dollars will be passed on to the consumer in the form of higher costs for transport and energy.”

Karl Thompson, an economist at the CEBR, said: “Whatever the inflationary environment, we are expecting that tech will be the big winner over the coming years.

“Decarbonisation, the challenges of hybrid working and likely longer-term skill shortages mean that, for many companies, heavy investment in tech is likely to be the only solution.

“We have identified nine sectors of tech where the skill requirements are likely to increase by more than 100 percent by 2031, led by Artificial Intelligence, virtual and augmented reality, robotics and medical tech, all of which are likely to need an increase in demand of more than 300 percent.”

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