Britain’s Autumn Statement: On the up

Posted: December 9, 2013 in economy
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On December 5th George Osborne, the British chancellor, delivered the Autumn Statement, where he outlined the British government’s economic policy for the next few months. We are hosting a round-table discussion of the Statement and related issues. Next up is Coen Teulings of the University of Cambridge. 

THIS YEAR’S Autumn Statement of the Treasure was a good news show. The Office for Budget Responsibility revised its growth forecast for this year up from 0.6% to 1.4% and from 1.8% to 2.4% for next year. The British recovery is remarkable because the world economy is not doing great at all. World trade is sluggish. The BRIC countries are not currently the engines of growth that they have been in the past. The strong British recovery is the more remarkable since the country is out of line with the euro zone. Due to its large financial sector Britain has been hit harder by the financial crisis than most other European countries. Its public finances were not in much better shape than those of other European economies, such as Spain. Nevertheless, Britain has found back its way to growth, while Spain still tries to gather steam after its severe austerity program. British growth for 2013 and 2014 is even above that of Germany, the self-proclaimed powerhouse of the euro zone. The question is: what explains this deviant experience? Why is this country doing so …

via Economic Crisis


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