The UK economy, at least since the process of starting to remove the country from the European Union, is going through a difficult situation. The UK economy, if we look at its growth in recent years, we can see how it has slowed down over the years. While growth in 2016 exceeded 2.4%, in 2019 this growth slowed to 1.4%; lower full percentage points. Even if we look at growth and compare it to the European average, for example, we see that the Anglo-Saxon countries are declining as far as European growth rates are increasing.
Tensions with Europe and the lack of a deal, in a scenario of extraordinary uncertainty, put an economy that has become one of the world’s financial capitals on the ropes, and that today has to struggle to keep the country’s big banks, their intention is to change places. their stay in the context of the new independence. The pound has nicely reduced its gap with the euro and the dollar, at the same time that more problems in the UK economy are starting to present themselves. Problems like labor shortages, or trade problems between Britain and its former allies are proof of that.
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To get an idea, the UK’s labor shortage has led companies to even hire prisoners to be able to face the next Christmas campaign, for example. This lack of a deal in a very mature Brexit has led many citizens of countries who are European citizens, faced with the hostility implied by Britain’s exit from Europe, to seek new destinations; like Ireland. In the same way, after the activation of the Brexit terms, the UK’s international trade with the European Union accumulated a decline of 18.9%, compared to a 9.1% decline with the rest of the world.
And it is at this last point that we want to study the article that concerns us here. Well, the dire situation that this British country is in, after several attempts by Boris Johnson to reach a trade deal with the European Union and the United States, by the way, without success, has made the British president interested in Mexico. , Canada and the trade agreements which, together with the United States, make up this large geographical bloc. T-MEC, a treaty that was very beneficial to Mexico, became the focus of the British authorities, because of their intention to join if at all possible.
After failing to reach an agreement of significant dimensions with the European Union, its main trading partner, and with the United States, after President Biden said reaching a deal with Britain was not a priority, Boris Johnson he was concerned about the project’s drifting path. As lucrative as Brexit has been for the UK, trade deals with former Commonwealth members, among other deals, are not working out as they should. The economy did not progress, and the pandemic ended the situation, leaving the United Kingdom with the largest recorded decline on the continent.
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Despite the fact that an orderly Brexit is finally done, and despite the fact that a deal has been reached with a decisive economy like Europe, the situation is not ideal. The UK economy is going through a difficult situation, and its finances are not in a position to deal with many problems without causing serious consequences for the population. We are talking about highly developed economies with great global powers, but the coronavirus, the case of Evergrande, the Great Recession of 2008 or the case of Lehman Brothers have taught us that, as Nassim Taleb said, black swans are possible. .
For this reason, it is necessary to find a new economic engine to boost the UK economy, especially after the collapse recorded in the last few months. And in this regard, T-MEC, Mexico being the best example, is a very lucrative deal for the economies that integrate it. To get an idea, trade in Mexico, thanks to T-MEC, today represents about 80% of the country’s GDP. The situation is compounded by a trade war with China, which has further strengthened ties with the Central American economy and its northern neighbor, Canada.
If it could become part of this trade agreement, Britain would have a strong partner for trade in goods and services, while striking the desired deal with the world’s leading economy, the United States. Overall, we’re talking about intentions and not events, so we should pay attention to how negotiations progress and the economic offer that once shined a lot, but is dwindling day by day.
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