The UK’s economic European (in)dependence

GBeurope

Les débats répétitifs au Royaume-Uni à propos de la sortie de l’Union Européenne sont d’autant plus animés qu’il paraît difficile de dégager une synthèse claire des avantages et des inconvénients qu’il y a pour la Grande-Bretagne à être membre de l’Union. Il faut dire qu’avant toute chose l’économie britannique se distingue de celle des autres puissances européennes, ce qui ne l’empêche pas d’en être très dépendante.

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The more dependent economies are, the more similar their problems are, according to the forecasts of the European Commission mentioned in “Les Echos” on November 6th, Great Britain is to keep the same economic problems as other European countries:

 – the unemployment rate in the U.K will be 7.5% this year, three fourths of European average (11%), lower than the French rate (11.2), but higher than the German one (5.3%).

– Britain’s public deficit will  reach 5.3%, twice as much as that of the E.U. (2.7%), lower than in Spain (5.9%), but much higher than in France (3.8%).

The City is not ready at all to give up its place as the first financial power in the world and is therefore already encouraging more hazardous investments for fear of an international fragmentation of financial markets. For example, UK Bank governor Marc Carney said on October 24th that regulation was over, according to an article written by Nicolas Madelaine in “Les Echos”. This is evidence that the country is not influenced at all by the rest of Europe and won’t economically cooperate if it implies any restricting concession, especially when the Euro area is weakened by very low inflation with the European Common Bank preventing deflation from resurfacing.

In trade the situation is quite different. Contrary to the bank leaders, corporate bosses want their country to remain in the European Union: according to a report by the Confederation of British Industry, each Briton gains 1225 pounds on average from their country’s EU membership. In 2012, 50% of British exports were in the E.U.

Even though this state joined the E.U in 1973, it still remains economically different with a more liberal form of capitalism. The will to leave the E.U is becoming stronger but the country remains heavily dependent on its fellow members.

Pierre DUTHILLEUL

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