CEBR: UK could drop out of the world's top 10 economies by 2015

vivatifosi

Interesting new Forecasting Eye from CEBR dropped through my virtual mailbox today.

http://www.cebr.com/Resources/CEBR/The%20UK%20drops%20out%20of%20the%20top%2010%20economies%207%20December%202009.pdf

"In 2005, the UK was the 4th largest economy in the world. China overtook in 2006, France in 2008 and Italy in 2009. So now the official figures suggest that we have dropped to No7 (although I still have some doubt about the Italian figures that are incorporated into this analysis). Projecting forward, the combination of economic growth and population growth, plus a likely rising real exchange rate mean that Brazil and Russia will overtake us sometime soon, perhaps in 2012. India will almost certainly overtake as well, though probably not till 2015. But it also looks as though Canada could, if demand for natural resources continues to rise strongly, catch up and surpass UK GDP around 2015 as well. Even Australia is likely to have overtaken by 2020."

Sounds like Gen was right to emigrate after all.

nearlynew

But gordon and alistair told us we were best placed to weather the storm.


Did they lie to us?

No, surely not?

vivatifosi

I think they did nearly.

bar stewards

Asheron

Where did all the money go? Mmmm

amcluesent

England could have an economy based on picking over the rubbish sent from China and India

vivatifosi

amcluesent wrote: »

England could have an economy based on picking over the rubbish sent from China and India

:rotfl::rotfl::rotfl:

Asheron

I can see Soup Lines coming over the next few years

PasturesNew

Look back in history and all the great nations have fallen... there was even some programme this week about papers being uncovered in Timbuctoo from thousands of years ago showing they were a leading intelligence centre, but now it's just a place of mud huts.

Why shouldn't the UK or the US do the same turn around of fortunes? Is it really so crazy?

Davesnave

I don't think it's inevitable that we go downhill that far. This country is still full of creative people, and I'm sure if we could put that creativity together with the science we've been teaching others, we could still produce world beating products.

We just have to get it through our heads that selling stuff like houses and services to each other is not all we can do.

vivatifosi

There is an inevitability about our being overtaken by emerging economies with much larger populations than ours: the likes of Brazil and Russia. However we have a choice as to whether we as a country want to be stronger than our similar size neighbours (France, Italy). France and the UK have vied for position over a number of years, but Italy is a real shocker.

Then there is the question regarding larger countries with smaller populations but which are resource rich (Canada, Australia).

Its sad that I couldn't reproduce the whole article due to copyright, because it does raise interesting questions. It asks whether being in the top ten matters other than psychologically, but then discusses the issue of whether or not we could reasonably expect to have such a major role on the world stage if we are no longer a key player. My own questions on reading this relate to the strength of the pound, and how strong an economy we would actually be if we left the EU: could we manage on our own?

These are important and unanswered questions that we need to face up to. I doubt however that they will get on the agenda any time soon. It would involve puffed up politicians acknowledging that their role on the world stage may actually be less important than they think.

Generali

amcluesent wrote: »

England...picking over the rubbish sent from China and India

Isn't that the basis of most High Street clothing outlets these days? Only there they call it a shopping experience.

vivatifosi wrote: »

.....discusses the issue of whether or not we could reasonably expect to have such a major role on the world stage if we are no longer a key player. My own questions on reading this relate to the strength of the pound, and how strong an economy we would actually be if we left the EU: could we manage on our own?

Ok, let's imagine a situation in 21 years time, 2030.

The UK economy has been overtaken in absolute size by Italy, Brazil, Russia, Canada, India and Australia so the overall size of her economy is 4th biggest in Europe and about 10th largest in the world.

The permanent seat on the Security Council would have to be up for grabs or at the very least more created. Why should Europe have 2.5 seats and Asia 1.5 with South America having none? Actually, given Britain's post WWII disinterest in hosting or holding positions of power in international bodies that would probably be the only particular direct impact.

The pound would also probably slowly devalue but then that is an ongoing process that has been happening since 1914 without major long-term impact as yet.

Leaving the EU would most likely be quite dumb unless it was to join a wider free trade area. The socialism forced on the UK comes at a much lower cost than freedom of labour and goods markets that come from EU membership.