UK economy overtakes India as 5th-largest in world & Brexit to boost it ‘by 6%’

THE UK’s economy is now the fifth-largest in the world after overtaking India and the Brexit trade deal could boost it by 6.1 per cent.

Meanwhile, despite the pandemic and a deep recession, the UK’s economy has overtaken India to become the fifth biggest in the world again.

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Research by the World Economic League Table, compiled by the Centre for Economic and Business Research (CEBR), shows Britain is forecast to have a 23 per cent better performance in Europe than France by 2035.

The UK has remained in the top six of the table for the past five years and recently leapfrogged India to take fifth place.

The organisation also believes China will overtake the United States to become the world’s biggest economy in 2028, five years earlier than previously estimated.

That will be due to the contrasting recoveries of the two countries from the pandemic, the think tank says.

Last year Britain fell behind India but the Asian nation has now been overtaken by the UK in dollar terms following a fall in the rupee and a Covid-related recession.

The UK is now behind only China, Germany, Japan and the US this year – despite a punishing year for business.

During the first half of 2020, Britain’s GDP fell 21.2 per cent as a result of the coronavirus lockdown.

The country is expected to have suffered the deepest recession of all leading G7 nations this year. 

The domestic independent forecaster, the Office for Budget Responsibility (OBR), predicts an annual average growth rate of 3.4 per cent.

But the CEBR is more optimistic. Forecasters say the annual growth rate will be an average of four per cent until 2025. 

Officials at the organisation say the UK continues to be “one of the better performers in Europe”.

The news comes as a leading accountancy firm forecasts economic growth of 6.1 per cent in 2021.

That figure would only have been only 3.3 per cent without a Brexit deal, reports the Daily Mail.

Boris Johnson hailed “glad tidings of great joy” in a Christmas message on Thursday night after sealing his £660billion Brexit trade deal.

Four years, five months and 29 days after the British people voted to leave the EU, the PM declared we would finally be able to set our own rules from January 1.

After four years of bitter wrangling between the UK and EU, the trade deal is now set to give the Covid-hit economy a much needed boost.

The pound soared against the dollar after a deal was done as business leaders expressed relief.

After the deal allowing the UK to trade tariff free with the EU, business leaders praised the PM, with Britain’s biggest business organisation the CBI hailing his “courage”.

Director general Tony Danker said the trade agreement came as a “huge relief to British business” at a time when firms were struggling with the Covid lockdown.

“The UK has a bright future outside the European Union and with a deal secured we can begin our new chapter on firmer ground,” he said.

Jonathan Geldart of the Institute of Directors added: “For business leaders, this Christmas gift is better late than never.

“A deal can draw a line under what has been a tumultuous few years for companies. It provides a stable basis for the future relationship with our biggest market.”

Richard Torbett, chief executive of the Association of the British Pharmaceutical Industry, and Nathalie Moll, his EU counterpart, said the deal was “in the best interests of patients”.

Richard Buxton, a fund manager at leading City firm Jupiter Asset Management said the agreement was “something UK share investors should celebrate”.

“After a very trying year, it is perhaps the best Christmas present many could have hoped for,” he said.

Negotiators including chief David Frost worked overnight and into the afternoon yesterday to iron out minor details in the 2,000 page legal text after the crucial fishing deadlock was broken.

Mr Johnson last night punched the air as he proudly showed off the 500-page trade deal.

MPs will vote on the deal on December 30 after the Government ordered Parliament to be recalled.