The UK’s largest independent producer of unbiased statistical data, the Office for National Statistics, has recently released a new report claiming that through their investigations they uncovered that the economy was £26 billion larger than previously indicated.
This nation’s economy is the fifth largest in the world, behind the United States, China, Japan and Germany. Their economic output usually comes in each year at around $2.8 trillion/ €2.5 trillion according to statistics published by the International Monetary Fund.
Additionally, the annual gross domestic product growth has been shown to have increased by 0.1 more than what was expected every year since 1997. This 21 year lag in the updating of GDP growth has been a huge factor in the sudden uncovering of the £26 billion in addition funds.
Although these statistics seem promising, the Office for National Statistics only included data up to a few months after the initial process of Brexit. The data that came after this most likely would have drawn down these figures, making the GDP expansion less significant than previously.
In recent years, Britain’s GDP has begun to transition its reliance from investment to domestic consumption. This unwanted change has somewhat stifled growth but is in no way comparable to the effects of foreign investments moving their business outside of the UK.
With Brexit on the horizon and the possibility of trade barriers hindering business processes, many companies that have part of their supply chain or who are entirely based in the UK have begun looking to move their investments outside of the country. This decrease in both national and foreign investment is likely to slow down the growth of the economy, if not reverse the trending GDP expansion entirely.
As of late, Ireland too has had an instance where the economy was shown to have grown much more than expected. In 2016, Ireland’s economy grew three times faster than expected, reaching a 26pc growth from 2015 to 2016.
This is unlikely to happen today, primarily because of Brexit, but reports stay hopeful that the Irish economy will continue to grow at a steady pace even after mass political and economic disruptions.
Many are unsure of these figures both in the UK and Ireland are real or based solely on inflation. Either way, these UK figures have provided a sense of hope that if Brexit is followed through with, both the UK and Ireland may not be as impacted as they had previously assumed.