UK lockdown: Economy must be reopened says Lord Bilimoria
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The CBI predict the UK economy will accelerate by 8.2 percent this year and continue to surge by more than six percent in 2022. In comparison, economists forecast the eurozone will spike by 4.2 percent with the EU’s largest economy, Germany, seeing just a 3.4 percent increase.
CBI economist Alpesh Paleja has said the predictions for the UK GDP have been “substantially upgraded” and has hailed the success of the coronavirus vaccine rollout.
Mr Palega added Britain is “very much ahead” of the eurozone when it comes to bouncing back from the pandemic.
He said: “We have substantially upgraded our forecasts for UK growth – it is a testament to the success of the vaccine rollout.
“We see much stronger growth in the UK than in the major eurozone economies.
“They also do recover over the course of this year and next, but the UK is very much ahead.
“A lot of it comes down to the improvement in health outcomes.”
The UK has administered more than 71 million vaccine doses, compared with just over 60 million in Germany and 44 million in France respectively.
Almost half of Britons have also received both doses compared to less than a third of people in Germany and less than a quarter in France.
The growth forecasts of 8.2 percent for 2021 would also put the UK ahead of the US, with a trillion-dollar spending spree from Joe Biden set to see GDP rise by 7.5 percent.
The CBI report also expects the UK economy to grow by 6.1 percent in 2022 – higher than the US, France, Germany and the eurozone as a whole.
The CBI says an extension of the Furlough Scheme into the autumn and expectations of a stronger economic recovery will lead to a lower peak in unemployment.
But, the report did warn business investment is set to remain five percent below levels seen before the pandemic.
CBI director general Tony Danker said: “There are really positive signs about the economic recovery ahead this year and next. The data clearly indicates that there is pent-up demand and ambition across many sectors.
“The imperative now must be to seize the moment to channel this investment into the big drivers of long-term UK prosperity.
“That’s why it’s the right time for Government to come forward with far more detailed plans on everything from decarbonisation, to innovation to levelling up.
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“Clearly this does not apply to the hardest-hit sectors from the pandemic who even now face continued delays and genuine challenges to stay viable.
“It would be devastating for hospitality, events or aviation businesses to fail on what we hope is the last leg of restrictions.”
Last month the Bank of England increased its estimate for growth in the UK GDP from 5 percent to 7.25 percent in 2022 – the fastest surge since the second world war.
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