eco TV

United-Kingdom: Brexit is coming, investments are waning…


In the UK, the prospect of Brexit has hindered foreign direct investments.

TRANSCRIPT // United-Kingdom: Brexit is coming, investments are waning… : January 2020

View more videos Eco TV

On the Same Theme

The trajectory of UK public finances after Covid 3/2/2021
Before the onset of the Covid-19 pandemic, the United Kingdom had already begun to come out of the “age of austerity”, to borrow a phrase from former Prime Minister David Cameron. The massive intervention of UK authorities to support the economy through the Covid-19 sanitary and economic crises has significantly strengthened this trend. The government deficit ran at almost 20% of GDP in 2020, and the ratio of government debt to GDP increased by twenty percentage points to nearly 100%. Once the crisis is over, some adjustments will be needed. That said, the Treasury’s eagerness to bring public finances back under control rapidly could be counterproductive if it stifled the economic recovery. Moreover, long-term prospects, particularly demographic trends, suggest that balancing the government’s books will be no easy task.
Some light at the end of the tunnel 2/5/2021
Unlike major European Union (EU) countries, UK still has not released its GDP for the fourth quarter of 2020. Nevertheless, the monthly indicator of the Office for National Statistics (ONS) gives a foretaste of how the economy fared during this period. In November, GDP contracted for the first time since April, falling by 2.6% as a second lockdown was imposed in England. This drop is due to the services sector, as the index for the production sector stagnated and the one for the construction sector increased...
United Kingdom: A month after Brexit 1/29/2021
A month after the UK’s exit from the EU’s single market and customs union, the economic effects of Brexit are starting to be felt, although there are some mitigating factors. Looking ahead, the British will face an important dilemma between using their newfound autonomy and staying aligned with the EU’s regulatory framework to protect their exporters.
Brexit: The worst has been avoided 1/6/2021
The United Kingdom has since 1 January fully exited the European Union, and a free-trade agreement has been found, as has been customary with Brexit, at the last minute. While that is good news for the British and European economies, Brexit is still “hard” and will surely trigger substantial economic losses in the long term.
Another contraction in Q4, before a definitive recovery? 12/17/2020
The record fall in UK GDP in the second quarter gave way to unprecedented growth in the third, and the news that an effective vaccine against Covid-19 will soon be widely available suggests that the economy could start its definitive recovery in 2021. However, the UK is not out of the woods yet. Given that a second national lockdown was introduced in England in November, there is little doubt that economic activity will drop again in the fourth quarter. Moreover, the strength of the recovery is, because of Brexit, more uncertain than elsewhere. This not only because of the UK’s decision to leave the EU’s single market and customs union, but also due to continued uncertainty over whether a free-trade agreement will be found. 
United Kingdom: what to expect next year in terms of growth? 12/11/2020
After record variations down and up, the UK’s GDP will probably fall again in the fourth quarter, due to the tightening of restriction measures. After that, the economic recovery will depend on two main factors: the evolution of the sanitary crisis and the consequences of Brexit.
United Kingdom: what will be the economic consequences of a hard Brexit? 11/30/2020
With only a few weeks left before the end of the transition period that has extended the United Kingdom’s de facto membership of the European Union, considerable uncertainty remains about Brexit and its consequences. Whatever the outcome of the current negotiations on a free trade agreement, it is clear that this will be a hard Brexit. From this observation, a number of important questions emerge. What will be the consequences of the UK’s withdrawal from both the EU’s single market and customs union? What effect will Brexit have on the UK economy, and will it differ across sectors? How will Brexit influence future economic policy in the UK?
Tuned in to BBC – Budget, Brexit, Covid 11/27/2020
According to the first estimate from the Office for National Statistics (ONS), United Kingdom GDP rose by 15.5% in the third quarter, in line with consensus estimates, as restriction measures were progressively lifted following the first lockdown. Despite this record increase, the level of GDP was still nearly 10% below where it was at the end of 2019. While Spain is in a similar position, the GDPs of the United States, France, Germany and Italy have all returned to about 5% below where they were back then...
Recovery already showing signs of weakness 10/16/2020
Most economic activity indicators have continued to improve recently. That said, the idea of a V-shaped recovery is already forgotten. While the economy is still far from its pre-crisis level, the recovery seems to be running out of steam...
United Kingdom: Mortgages caught between support and restriction 10/14/2020
New mortgage lending fell by 33% year-on-year in the second quarter of 2020, the steepest decline since 2008. British lenders have been more cautious since the beginning of the year. This is evidenced by the decrease of 4.0 percentage points (pp) in the share of loans with a loan to value (LTV) figure in excess of 75%; the bulk of this concerns loans with an LTV between 75% and 90% (-3.2 pp). To tackle this trend, and with Nationwide’s property price index continuing to rise, the UK government plans to boost home ownership by encouraging loans with an LTV of up to 95%. The government’s plans might seem hard to reconcile with increased caution amongst lenders, who have also seen a significant increase in their cost of risk[1], and the associated tightening of the capital constraint by the BoE. The latter considers a possible additional capital requirement[2] and the introduction of an increase in the weighting of mortgage loans in the internal-ratings-based approach[3]. Due to come into force in January 2022, these rules will be more targeted and more rapidly applicable than the output floor, which also seeks to correct the weightings of banks’ internal models but applied to their entire portfolios. [1],c34491 [2] BoE (22.07.20) Speech by Sarah Breeden “Climbing mountains safely” [3] BoE (30.09.20) CP14/20  “Internal ratings based UK mortgage risk weights: Managing deficiencies in model risk capture”

ABOUT US Three teams of economists (OECD countries research, emerging economies and country risk, banking economics) make up BNP Paribas Economic Research Department.
This website presents their analyses.
The website contains 2637 articles and 691 videos