The UK economy at a glance

The factors covered are:

• Overview of the UK economy

• Economic growth

• Exchange rates

• Interest rates

• Inflation

• Foreign direct investment

• Trade

• Taxation

• Major UK-owned companies

• Labour environment

• Further information

The government department in the UK with responsibility for the economy is HM Treasury. For further information, please see: www.hm-treasury.gov.uk

1. Overview of the UK economy

The UK is the fifth largest economy in the world, with a gross domestic product (GDP) of US$2,727 billion (Source: World Bank, 2008). The UK is forecast to have the strongest business environment of all major European economies for the period from 2008 to 2012 (Source: EIU, 2008).

In summary, the UK:

• has a population of 61 million (Source: ONS, 2008),

• was the second largest recipient of foreign direct investment (FDI) globally in 2007 (Source: UNCTAD, 2008),

• is a leading global trading nation, being the second largest exporter and third largest importer of commercial services, and the eighth largest exporter and fifth largest importer of merchandise (Source: World Trade Organization, 2009),

• is a member of the European Union, the world’s largest trading entity, with nearly 500 million consumers and a GDP of approximately US$19,000 billion (Source: Eurostat, 2008),

• is one of the most competitive locations in Europe for business and personal taxation,

• has low unemployment (with an unemployment rate well below the European Union average), and

• has the best European city – London – in which to do business (Source: Healey & Baker, European Cities Monitor, October 2008).

For more information please see:

• the Office for National Statistics (www.statistics.gov.uk),

• Eurostat/European Commission (www.europa.eu.int/comm/eurostat),

• the Organisation for Economic Development and Co-operation (www.oecd.org),

• the World Trade Organization (www.wto.org), and

• the United Nations Conference on Trade and Development (www.unctad.org).