The Organization for Economic Co-operation and Development expects the British and Russian economies to contract this year, while raising its global growth forecast to 2.6%.
The Organization for Economic Co-operation and Development said Britain will join Russia this year as the only two major economies likely to contract, while the organization raised its forecast for global growth.
The Paris-based firm has awarded the UK the largest joint promotion among the Group of Seven nations. But despite this, Britain will still have one of the worst performing economies in the world.
Decline followed by weak recovery The Organization for Economic Co-operation and Development forecast a 0.2% decline in UK GDP this year, followed by a weak 0.9% recovery in 2024. These numbers are 0, 2 and 0.7 percentage points higher, respectively, than forecasts. November
The forecast underscores the pessimistic view of the UK by international experts as it grapples with double-digit inflation and a credibility gap after last year’s failed fiscal plans. The OECD ruling comes after Britain’s Chancellor of the Exchequer, Jeremy Hunt, unveiled a “growth budget” aimed at stimulating business investment and improving labor supply.
“The UK is facing very serious cost-of-living pressures,” OECD Secretary-General Matthias Cormann told a news conference. Retail energy prices have risen more than in comparable economies, while that wages are not maintained”.
Avoiding a “technical recession” He also indicated that there is a “continuing state of uncertainty” over UK trade relations, referring to Britain’s decision to leave the European Union, and hundreds of thousands of people leaving the market. employment at the beginning of the Corona pandemic.
He added: “We believe that the actions the government takes to address these issues will be very important in improving the UK’s economic prospects going forward. But there are some particular challenges at stake at the moment.”
These figures are more bearish than those released on Wednesday by Hunt and the UK’s Office for Budget Responsibility. While the “Office for Budget Responsibility” also expects a contraction of 0.2% this year, and that the UK will be able to avoid a “technical recession”, it also expects a much faster recovery of 1.8% of GDP in 2024. .
Government optimism The Organization for Economic Co-operation and Development said on Friday the UK would see a “moderate recovery” next year, but noted it is struggling to control inflation. He stated that consumer prices would rise 6.7% in 2023, more than triple the official target. This figure is similar to inflation in Germany and Italy, however, it is only better than inflation in Turkey and Argentina, which are facing economic problems.
Responding to expectations, Chancellor of the Exchequer Jeremy Hunt highlighted a stronger than expected performance of the UK economy in recent months.
“The UK economy has proven more resilient than many expected, beating many forecasts to be the fastest growing economy in the (G-7) last year, and is on course to avoid recession… at the beginning of this year”. Hunt wrote in a statement on Friday. This week, I laid out a plan to grow the economy by unlocking business investment and helping more people go to work.”
Similarity to Russian economy performance The Organization for Economic Co-operation and Development said the UK’s sluggish performance by 2023 compares with 0.8% growth in the “eurozone” and 1.5% expansion in the U.S. The organization stated that global growth will slow to 2.6% this year, before picking up again in 2024.
Russia’s GDP is expected to decline 2.5% this year and another 0.5% in 2024, extending its stagnation since the invasion of Ukraine.
Jamie Davies, spokesman for British Prime Minister Rishi Sunak, told reporters on Friday: “I would like to point to the fact that the same report rates growth higher for the UK in 2024 than any other (G7) country, before to take it into account.” account in full, the measures that were outlined in the budget by the Secretary of the Treasury earlier this week.”