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UK expected to be only major economy to shrink in 2023 – IMF

143 pointsby open-source-uxover 2 years ago

19 comments

hunglee2over 2 years ago
UK is in a unique position of consistently making political decisions which cost money;<p>unnecessarily hard Brexit, raising cost of import &#x2F; export, reducing tax revenues, increasing cost of employment, increasing cost of doing business<p>various rushed trade deals (Australia &#x2F; NZ) made to satisfy the newspapers, despite them harming domestic farming for nothing in return<p>various boondoggles (BritishVolt) invested in to demonstrate British industrial power, ignoring economies of scale and decades long commitment needed to see it through<p>demonstrating fealty to the US by hostile decoupling with China, despite M15 passing Huawei telecoms products as fundamentally secure, costing UK Gov billions to replace equipment<p>swashbuckling leadership in support of Ukraine, overcommitting already threadbare armed forces, such that a US general commented today that the UK army is no longer a first class service as a result<p>the list can go on.<p>UK has a political crisis, based on an identity crisis, for which there is no foreseeable solution on the horizon. Needs a miracle breakthrough technology (graphene? quantum computing?) - a literal moonshot - to reverse this decline
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jgrahamcover 2 years ago
I have done my part in this slow down I imagine: ordering anything from the UK for delivery into the EU is a nightmare. Everything takes forever and smaller businesses simply don&#x27;t deal with the paperwork meaning you&#x27;re left with a mess at local customs. The result is dealing with local bureaucracy and paying high import duties (or in some cases simply seeing the thing you bought get returned to the UK).<p>Because it became such a mess I simply gave up.<p>For example, I used to buy Elemis brand products. They still sell in Euros but here&#x27;s what it says on their website: &quot;Please note, orders that are shipping outside of the UK will not be charged UK sales tax but maybe subject to customs charges and tax that will need to be paid directly. This affects orders placed both in £ and in Euro. We advise you to please check requirements with the local authority before placing your order.&quot; (<a href="https:&#x2F;&#x2F;eu.elemis.com&#x2F;delivery" rel="nofollow">https:&#x2F;&#x2F;eu.elemis.com&#x2F;delivery</a>)<p>Ordering from the UK is the same as ordering from the US or China. Which is ridiculous given the physical proximity. Great job poking yourself in the eye, Britain!<p>And, worse, there are businesses that have figured out the customs&#x2F;tax situation and will ship directly to Europe with no problem, but now I&#x27;m gun-shy and figure it&#x27;ll be a mess so I go look elsewhere.
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racktashover 2 years ago
I voted Remain in the referendum and my stance on the matter hasn&#x27;t changed. To me, it always made sense to be part of the EU. I say this up front in case what I say next is read in the wrong light.<p>I get wary when so many people, or so it seems to me, delight in the economic situation Britain is in, pointing out how duped the sad saps that voted Brexit must now be feeling.<p>But from the Brexit voters I&#x27;ve talked to, the whole point was always political independence. When Ireland fought to be independent of the UK, to take but one example, pointing out the economic negative effects is to miss the point of seeking independence completely. I know the situation between the UK and EU is different to that of the UK and Ireland of old. My point is that the UK has strong, old political traditions that some felt, rightly or wrongly, were being interfered with by foreign political institutions.
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globalise83over 2 years ago
I left the UK in 2015 to live in mainland Europe. At that time it really felt like the UK was in a great position: at the center of the world&#x27;s scientific research, leader in finance, publishing, knowledge-based services and cultural production, part of a huge single market. Travel connections to every town in Europe. All things in which I experienced day-to-day. The day I woke up to hear the news about the Brexit vote in 2016, I knew that was all gone, and now here we are.
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mathwover 2 years ago
Yup, we&#x27;re in trouble.<p>It would be nice to elect a competent government, but there won&#x27;t be an election until the current talentless frauds call one, and I&#x27;m not entirely convinced that any of the people who might win such an election are really any better. They might be for a while I suppose, but one thing our political system is not doing well is elevating talented, capable or inspiring people into positions of authority and leadership.<p>Rather difficult to do that when the public discourse runs in a media landscape fuelled by the need to make online advertising revenue.
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PaulHouleover 2 years ago
I have a system that selects articles out of RSS feeds and one topic I&#x27;ve been watching in the last month is the political and economic breakdown in the UK.<p>Here in the US we have George Santos and will probably see some brinksmanship over the debt ceiling this year, but in the UK the Tories are going through prime ministers and other leaders like matches. We had Jan 6 in the US but they had Brexit which is a self-inflicted injury that will never heal. Things were on the right trajectory in Northern Ireland in that there was no border and you could be as British or as Irish as you wanted to be but they wrecked it.<p>The calendar of strikes in the UK is filled weeks ahead of time. Sooner or later the strikebreakers are going to go on strike. It is somewhat astonishing that the Tories are still in power but you can credit that to the last generation of labor leadership that seemed to have a vision for the UK becoming more like Cuba or Venezuela.
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throwaway22032over 2 years ago
The UK political system is anti-business. It&#x27;s just that simple.<p>IR35 makes it a pain in the arse to do contract work. It turns a simple &quot;want this doing? ok, sure&quot; into a legal mess. Public sector contract? Forget about it.<p>Business rates on commercial property turns high streets into ghost towns.<p>Ridiculous &quot;reforms&quot; in the housing market both pump prices and also reduce rental supply. So now we have a rental crisis whereby people are paying 900 a month for a single bedroom in the capital when commonly wages are 1.5k a month.<p>During coronavirus the government told businesses to close but didn&#x27;t pass legislation to freeze or help them with rental costs. So a ton of businesses just failed because all of their savings went to their landlord whilst they were legally forbidden from earning anything.<p>London added a charge of £15 a day to basically every independent tradesman&#x27;s van which directly increases their costs by over £2k a year unless they spend even more than that &quot;upgrading&quot;.<p>I could go on. Top to bottom it&#x27;s just anti growth. A lot of this stuff needs to be ripped up and we need to start again with policies actually designed to grow the economy.
password54321over 2 years ago
Anyone else want to see the UK go into recession? A lot of people are very upset as it is, with the collapse of the NHS, schools and public transport and rising food costs. At the same time it is not even the British people who get a lot of the high paying jobs. And I really don&#x27;t see things changing much without drastic consequences.
BurningFrogover 2 years ago
Lots of grand conclusions from a single data point here.<p>Congratulations to everyone who has been proven right!
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jvmfjvfjvfover 2 years ago
Germany actually shrank. Why isn&#x27;t this mentioned?<p><a href="https:&#x2F;&#x2F;www.ft.com&#x2F;content&#x2F;dc978c84-64c4-42cd-bfe5-7d59e1441475" rel="nofollow">https:&#x2F;&#x2F;www.ft.com&#x2F;content&#x2F;dc978c84-64c4-42cd-bfe5-7d59e1441...</a>
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maxehmookauover 2 years ago
Yeah, increasing trading barriers with the world&#x27;s largest trading bloc that you also happen to be physically connected to will do that.<p>Brexit is a catastrophe.
FlotaDeAragonover 2 years ago
Economists have predicted a crash in the UK economy in the last 6 out of 6 years<p>Time passes and performance stays identical to Germany and France
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zabzonkover 2 years ago
apparently, boston uk is the town that most believes that brexit has been a success in the country. the majority of uk people believe otherwise, and think that brexit has been the cause for the economy shrink.<p>mind you, boston and inhabitants are a bit like innsmouth, so maybe the deep ones have had something to do with this?
MisterBastahrdover 2 years ago
Man, if only someone would have told them that their isolationism due to racism and xenophobia would end up crippling their economy. Besides everyone with a working brain, I mean. Meanwhile, it seems they&#x27;ve got at least 5 more rounds in the revolver with which to shoot themselves in the same foot.
Krisjohnover 2 years ago
&quot;expected&quot;? So the rest of the world is just going to be surprised?
stjohnswartsover 2 years ago
Brexit was their own choice so I don&#x27;t have much sympathy for them.
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rgllmover 2 years ago
One word: Brexit
icuover 2 years ago
Imho the UK post Brexit lacks political leadership that knows how to manoeuvre the competing political factions within the Conservative party and balance the short-term and long-term economic pressures it faces.<p>Trump was the UK&#x27;s best chance at a US trade deal and the terms were too unpalatable for the Conservatives. This imho was a self inflicted economic injury. Demographically most of the West (including the EU) is in terminal demographic decline and in particular the European flavour of socialism (i.e. a deep belief that the State is a necessary part of economic development) will start to fail under the crushing weight of an ever larger aging population.<p>The US and Mexico will be the most important growth export market for the UK going forward into the next several decades, and the cost of a trade deal with the US will increase the longer the UK gets desperate.<p>Alternatively the UK could try to create a Commonwealth free trade zone (and include the 2nd most important market India) but that takes imagination and leadership that again I think is lacking.
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billpgover 2 years ago
Thank you Brexit!