United Kingdom

Economic and political outline

Economic indicators | Foreign Trade in figures | Sources of economic information | Political outline

Economic indicators

Falling from over 3%, the GDP growth rate was 2.8% in 2006 due to decline in domestic consumption and investments.
The United Kingdom (UK) has the 5th largest economy in the world and the 2nd largest in the European Union (EU). In 2006, it was globally the second largest recipient of foreign direct investment. A highly developed, diversified, market-based economy with extensive social welfare services provides most residents with a high standard of living.
The unemployment rate is one of the lowest in Europe (estimated at 5.4% in 2007) and the Uk's skills base one of the best. It still faces two major challenges: to modernize its public services (transport, education, public health, etc.) and to reform the pension system.

GDP Indicators	2004	2005	2006	2007	2008
GDP (billions USD)	2,169.39	2,246.33	2,398.95	2,755.92e	2,933.24e
GDP (constant prices, annual % change)	3.3	1.8	2.8	3.1e	2.3e
GDP per capita (USD)	36,256.87	37,303.31	39,630.38	45,301.06e	48,071.66e
General government balance (in % of GDP)	-3.4	-3.3	-2.7	-2.5e	-2.3e
Inflation rate (%)	1.3	2.0	2.3	2.4e	2.0e
Unemployment rate (% of the labor force)	4.8	4.8	5.4	5.4	5.4
Current Account (billions USD)	-35.41	-55.44	-77.24	-96.69e	-105.14e
Current Account (in % of GDP)	-1.6	-2.5	-3.2	-3.5e	-3.6e

Source: IMF - World Economic Outlook Database

Note: (e) Estimated data

Socio-demographic indicators	2006	2007	2008
Unemployment rate (%)	5.4	5.4	5.4

Source:

Main sectors of industry

Agriculture sector contributes only 1% of the GDP and employs 2% of the active population, but is very productive. Cattle breeding is still the major agricultural activity, despite "mad cow" and "foot and mouth" disease crisis. Fishing sector is also well developed.
UK has considerable mineral resources. Once the world's 10th largest oil producer with huge gas reserves, its production is leveling fast. Groups like BP and Shell are still among the global leaders in the petroleum industry.

Manufacturing industry is not very competitive and accounts for around 19% of the GDP. The sectors having good potential are pharmaceutical, aircrafts industry and defense.
The services sector is the driving force behind the economy and contributes nearly 74% to the GDP. London is Europe's largest financial market place, at par with New York.

Breakdown of economic activity by sector	Agriculture	Industry	Services
Value added (annual % change)	-0.8	-1.3	2.9
Value added (in % of GDP)	1.0	26.2	72.8
Employment by sector (in % of total employment)	1.4	22.0	76.3

Source: World Bank - World Development Indicators - last available data.

Monetary indicators	2002	2003	2004	2005	2006
Average annual exchange rate for 1 USD	0.67	0.61	0.55	0.55	0.54

Source: World Bank - World Development Indicators

Foreign trade in figures

The UK is one of the leading trading nations in the world. It is the second largest exporter and the third largest importer of commercial services, and the seventh largest and fourth largest importer of merchandise (Source WTO, 2007). Leading destinations for UK products include the US (16% of all exports), Germany (9.9%) and France (9.7%). Exports of goods and services to the EU as a whole accounted for around 55% of all UK exports (Source: ONS, The Pink Book, 2007).

Foreign trade indicators	2002	2003	2004	2005	2006
Imports of goods (millions USD)	351,636	387,254	461,133	509,404	603,328
Exports of goods (millions USD)	279,866	307,799	349,657	384,332	449,351
Imports of services (millions USD)	110,023	127,250	149,917	163,589	176,904
Exports of services (millions USD)	135,308	158,615	197,431	207,882	231,440
Imports of goods and services (annual % change)	4.5	1.8	6.7	5.3	n.c.
Exports of goods and services (annual % change)	0.2	1.2	4.6	5.6	n.c.
Imports of goods and services (in % of GDP)	29.2	28.3	28.6	30.0	n.c.
Exports of goods and services (in % of GDP)	26.2	25.5	25.2	26.1	n.c.
Trade Balance (millions USD)	-71,770	-79,455	-111,476	-125,072	-153,978
Trade Balance (including service) (millions USD)	-46,484	-48,090	-63,961	-80,778	-99,441
Current Account (millions USD)	-24,606	-24,468	-35,184	-52,715	-79,966
Current Account (in % of GDP)	-1.6	-1.4	-1.7	-2.4	-3.4
Foreign trade (in % of GDP)	55.5	53.8	53.8	56.1	n.c.

Source: World Bank - World Development Indicators

Main partner countries

Main customers (% of exports)	2006
United States	13.2%
France	11.9%
Germany	11.1%
Ireland	7.1%
Netherlands	6.8%

Main suppliers (% of imports)	2006
Germany	12.1%
United States	8.0%
France	6.6%
Netherlands	6.2%

Source: 2006

Main products

Main exports (% of exports)	2006
Electrical machinery and equipment	18.4%
Machinery and mechanical appliances	16.1%
Mineral fuels, mineral oils	9.7%
Vehicles other than railway or tramway	8.4%
Pharmaceutical products	5.5%

Main imports (% of imports)	2006
Machinery and mechanical appliances	12.0%
Electrical machinery and equipment	11.6%
Vehicles other than railway or tramway	10.3%
Mineral fuels, mineral oils	8.9%

Source: 2006

To see more products: More imports (Intracen Data)
More exports (Intracen Data)

Sources of economic information

Ministries: British Monarchy Parliament Prime Minister's Office Ministry of Agriculture, Fisheries and Food (MAFF)Department of Trade and Industry Directorate of Standardization (Dstan)Inland Revenue
Statistical Office: Office for National Statistics
Central Bank: http://www.bankofengland.co.uk/
Stock Exchange: FTSE The Index Company
London Stock Exchange
Online newspapers: Financial Times
The Economist
The Guardian
The Times
The Independent
The Daily Telegraph
Search Engines: Yahoo! UK
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AltaVista.co.uk
Curry Guide
Cyber Britain
Excite.co.uk
GBP
Hotbot.uk
Lifestyle UK
Lycos.co.uk
Mirago
Mugomilk
Netscape.uk
Search.uk
Splut
UK Directory
UK Index
UK Plus
WhatsNew.com
Yell
Economic portals: Economy Watch

Political outline

Executive Power: Queen is the chief of the state. Though her role is in reality largely ceremonial, the Queen does continue to exercise three essential rights: the right to be consulted, the right to advice and the right to warn.
Following legislative elections of the lower house of the parliament, the leader of the majority party or the leader of the majority coalition is usually appointed as Prime minister by the Queen to serve a five-year term. Prime Minister is the head of the government and enjoys all the executive powers that include implementation of the law in the country and running the day-to-day affairs. The Cabinet of Ministers is appointed by the Prime Minister.
Legislative Power: The legislature is bicameral in UK. The Parliament consists of: House of Lords (the upper house) having approximately 500 life peers, 92 hereditary peers and 26 clergy, and House of Commons (the lower house) having 646 seats with its members elected by popular vote to serve five-year terms. The government is directly answerable to and dependent on the Parliament.
Main political parties: Labour Party: traditionally left-wing, allied to trade unions.
Conservative Party: centre-right , believes in free-market economy.
Liberal Democrats: centrist, moderate pro-European, opposes the Iraq war and strong on civil rights.
Current political leaders: Queen: ELIZABETH II (since February 1952).
Prime Minister: Gordon Brown (since June 2007), Labour Party.
Next election dates: House of Commons: May 2010