The winner of Britain's July 4 election will face an economy burdened by slow growth and high debt, posing challenges to achieving a strong recovery, recent data from the Office for National Statistics shows .
The economic challenges facing Britain are deep-rooted and versatile. Since the global financial crisis, the country has been further destabilized by subsequent events such as Brexit, the COVID pandemic and rising energy prices. As a result, Britain's economic performance has lagged, especially in terms of productivity and living standards, compared to other G7 countries.
Prime Minister Rishi Sunak, despite facing a significant deficit in the polls, claims the economy is on the mend. He points to falling inflation and recent GDP growth as evidence of this improvement. However, according to the International Monetary Fund (IMF), economic forecasts remain cautious, predicting modest growth of 0.7 percent in 2024 and 1.5 percent in 2025. These figures are significantly below the pre-crisis average, indicating a long road to recovery.
The Labor Party, which is currently leading in the polls, attributes the decline in living standards to the policies of the Conservative government. Labor is promising to revive the economy through more private investment, aiming to tackle the stagnation that has characterized recent years. Their proposed policies are aimed at promoting a business-friendly environment that can stimulate growth.
However, Labour's plans are heavily dependent on improving trade relations with the European Union. Since Brexit, tense relations between Britain and the EU have damaged trade and investment. Labor admits better relations are key to economic recovery, but faces major challenges.
Both sides recognize that economic recovery requires immediate growth measures and long-term strategies to boost productivity, attract investment and improve living standards. The upcoming election is crucial in determining Britain's economic direction. Decisions made by the next government will have a profound impact on Britain's future and its ability to navigate the global economic landscape.
Khalid Talukder, co-founder, DKK partners: “The upcoming elections in July are a crucial moment for Britain to champion business and technology as key drivers of economic recovery. Despite current challenges, Britain can leverage its position in innovation and international trade.
The next administration must prioritize policies that support business and the technology sector, including investing in robust payment systems and attracting private investment. This will enable companies to expand into new markets, drive technological advancements and generate new revenue streams.
As we approach the elections, it is critical that we focus on strategic initiatives to strengthen the economy.”
