the British economy finally much stronger than announced

In the London port of Tilbury, February 13, 2023.

“Maybe the UK is not so bad after all. » Captioning their note, Friday 1er September, the economists of the financial services group Nomura did not hide their huge surprise. The National Statistics Office (ONS), the British equivalent of INSEE, has very significantly revised the country’s growth for the year 2021, and to a lesser extent for 2020. Suddenly, the Kingdom United, which seemed to be lagging behind other Western countries since the pandemic, does not seem to be at the bottom of the hole.

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In 2021, an exceptional year of rebound following the pandemic, growth would ultimately have been 8.7%, i.e. 1.1 points more than initially announced. Such a review is unprecedented. If all the statistical institutes continue to revise their figures years after the first estimates, the changes rarely exceed 0.1 or 0.2 points. All in all, also counting a slightly less steep contraction for 2020, the new measures profoundly change the analysis of the UK economy: in the fourth quarter of 2021, its gross domestic product (GDP) was 0.6% above its pre-pandemic level, compared to a previous estimate that placed it 1.2% below.

The British government is jubilant. “The declinist narrative about the UK and its long-term prospects is simply wrong”, said Jeremy Hunt, Chancellor of the Exchequer. Suddenly, the international comparison is no longer so negative for the UK. Until now, the country seemed to be the G7 country that had rebounded the least well from the pandemic. The effects of Brexit were often used to explain the phenomenon.

” Amazing “

The new calculations challenge that umption. In the second quarter (provided that the estimates for 2022 and 2023 are not themselves profoundly changed!), the British economy was finally 1.5% above its pre-pandemic level, better than Germany (0 %), almost at the same level as France (1.6%) and below Italy (2.1%), Japan and Canada (3.5% each) or the United States (6 .1%). “The United Kingdom is no longer behind the G7 and not so far from the average”concludes Ruth Gregory, of the firm Capital Economics.

Simon French, chief economist at investment bank Panmure Gordon, judge ” amazing “ data review: “All the headlines that said ‘UK not back to pre-pandemic level’ are now outdated. »

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