Britain is set to surge ahead of France to take over as Europe’s second largest economy and the fifth largest in the world.
Although Britain will push ahead of France and close the gap on Germany, Europe’s economic powerhouse by 2020, the success is expected to be short-lived.
Economists at financial firm PwC reckon India will replace Britain as fifth in the world economic rankings by 2030.
The factors underlying Britain’s re-emergence as a major economy include a large, young workforce and low unemployment.
“Since the recession, Britain has won back that economic feel-good factor that seems to be missing in France,” said the PwC report.
Emerging markets
“Other emerging world markets will inevitably overtake Britain, but current thinking only puts India in a position to do so over the next two decades.”
The study also found that companies from overseas find Britain an easy place to do business.
“The country has made great strides with infrastructure for businesses, like developing technology and communications,” said the report. “Also Britain has a friendly and transparent political, legal and regulatory structure that injects stability and certainty into the minds of business leaders.”
The picture is not all rosy, says PwC, as the economy still has gaps that need improvement.
Strong recovery
“Education and pay equality are sadly lacking, while the government on inflation, investment and improving the trade deficit,” said the report. “Nevertheless, the country is making a strong recovery that is likely to be sustainable for some time ahead.”
The United States, China, Japan and Germany currently lead the way as the world’s most powerful economies.
India is expected to claw up to third by 2030, behind the US and China, which will retain the top places over the next 20 years.
Brazil, Russia and Mexico will also show well in the rankings, found the study.
Japan is slipping back as projections expect the population to drop by at least a third over the coming years, leading to a significant impact on trade.
