According to COUNTRYAAH, the country’s industry has long been based on the traditional (and partially obsolete) heavy industry such as coal mining, shipyards, steel and engineering. Over the past 30 years, a structural change has taken place to such an extent that the industry now accounts for only 20 percent of GDP, while the service industries have increased sharply. Foremost, the financial and oil sectors have grown rapidly. Oil and natural gas were discovered in the North Sea in the late 1960s, and extraction began shortly after.
The London Stock Exchange is one of the largest in the world, and the capital houses a very large number of foreign banks. More than 40 percent of Japanese and US direct investment in the EU is now in the UK. The economic policies that have been in place since 1979 have led to major changes in the form of increased market adjustment, tax reductions, privatizations and inflation control. The first years included high unemployment and inflation, but since 1982 inflation has been low and production has increased.
During the late 1990s and early 1990s, the British economy grew; In 1997–2007, GDP increased by an average of 3 percent. In 2008, the country was hit hard by the global financial crisis. Falling house prices, high consumer debt and the slowdown in the global economy caused the country to experience a recession at the end of 2008. This led the government to implement a number of measures to stimulate the economy. The financial years were followed by financial tightening. In 2013, the economy began to recover, a trend that continued. In 2014, GDP was at the same level as before the 2008 economic crisis.
|Year||Change in GDP (%)||Government debt share of GDP (%)||Budget deficit’s share of GDP (%)||Inflation (%)||Unemployment of total workforce (%)|
Source: IMF, OECD and World Bank
As a result of early industrialization and urbanization, the agricultural sector in Britain was small as early as the late 1940s. In 2017, agriculture accounted for just under 1 percent of GDP, and the proportion of employed in the sector was just over 2 percent. However, production has constantly increased, and agriculture now forms a modern and efficient part of the British economy. The rationalization has meant that the average farm size has grown to 70 ha (the highest in the EU). The entry into the EC of 1973 with its common agricultural policy has meant guaranteed prices for producers and increased self-sufficiency; the need for example. oats, wheat, rye, potatoes and meat are now almost exclusively covered by domestic production. However, exports of agricultural products are relatively small, just under 7 percent of total exports. However, EU policy has meant high prices. In addition, most of the support has gone to the large farms in the south at the expense of family farming around the country. Following some reforms in agricultural policy, prices are now at a lower level and earlier overproduction has decreased.
About three quarters of the country’s land is used for agriculture. The cultivated area decreases annually in favor of pastures. The most important crops are wheat, barley, sugar beet, potatoes, oats and more recently rapeseed. Animal husbandry is dominated by cattle, sheep, pigs and poultry. Gardening is common around the cities in the southeast and in the Midlands, and early fruits and vegetables are cultivated along the south coast. The most intensive and large-scale agriculture is conducted in East Anglia, north of London. Unlike large parts of Europe, radical shifts were carried out during the 18th and 19th centuries in the United Kingdom, as in Sweden and Denmark. This greatly characterizes the country’s (especially England’s) cultural landscape, which is dominated by individual farms and large fields surrounded by hedges.
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About 3 million ha (one tenth of the country’s area) is used for productive forestry. The state-owned Forestry Commission is responsible for about 40 percent of this. The British forest area has doubled since 1919. The productive forest increased by about 220,000 ha during the years 1985–94, mainly on privately owned land. The main reason was the tax relief that landowners have received, but after extensive criticism that said that financial considerations have been taken over environmental considerations too much, most benefits have now been removed. Most new plantings are in the form of conifers in highland areas. The country’s production covers just over 10 percent of the need.
With its approximately 6,000 boats, the UK has the EU’s second largest fishing fleet after Spain. The United Kingdom is one of Europe’s leading fishing nations but has experienced a sharp decline. The total catch has decreased by 12 percent during the period 2001-13. The decline has several causes: firstly, the country has lost the right to the more remote deep-sea fishing in, for example, Iceland, and the EU has been forced to open its own waters to other fishermen, and the EU has introduced restrictive fishing quotas which must not be exceeded. The downturn has affected mainly the large and modern fleet and thus also the larger ports. The most important fish species caught are cod, haddock, mackerel, whiting, herring and plaice.
Abbreviated as GBR by abbreviationfinder.org, the United Kingdom has more energy resources than any other EU country. Coal, which was once a prerequisite for the British business community, has declined significantly in importance. At the time of the First World War, 300 million tonnes were broken by one million miners. In 1995, extraction had decreased to about 90 million tonnes and the number of employed to below 50,000. In 2013, 13 million tonnes were broken and the number of employed was just over 6,000. In 2011, there were almost 40 mines (1950 there were over 900), concentrated to the Midlands, Yorkshire and the north-east England. In the formerly important mining districts of southern Wales and Scotland, only a few remain. This powerful rationalization, which is expected to continue, has led to major social problems but at the same time has made the country the most efficient coal industry in Europe and the only one that has managed to survive without subsidy. Other mining produces aluminumand, in small quantities, lead. Bulk processing or production is made of iron, steel, cement, potassium carbonate (potash; see Potassium: Compounds), sand, natural gravel and stone.
The oil and gas industry has been the UK’s largest industrial sector for the past four decades and in 2012 contributed 70 percent to the country’s energy needs. The production of North Sea oil began in 1975, and in 2012 the country was 60 percent self-sufficient for crude oil. The oil is taken in via pipelines to ports in the Shetland and Orkney Islands, in Scotland and to Teesport outside Middlesbrough. The North Sea gas began to be mined as early as 1967, and today there is a pipeline network across the country that has replaced the natural gas now with the coal-dependent city gas. Oil and gas production is expected to gradually decline as a result of declining reservoirs and an increase in renewable energy sources.. The latter contributed to only 5 percent of the energy demand in 2012 but is expected to be 15 percent by 2020.
The UK’s energy needs are covered by almost 90 percent of fossil fuels and the remainder mainly by nuclear energy. More than half of the country’s energy supply is produced within the country while the rest, mainly crude oil and natural gas, is imported. Almost half of its own production consists of crude oil and one third of natural gas. Of the total energy consumption, three quarters are based on petroleum products and one fifth on electricity. Consumers account for one third of the transport sector and the housing sector, while the transport sector accounts for the majority of the remainder. Just over a quarter of the energy supply is exported, and almost exclusively in the form of oil products; a very small part of the electricity supply is regulated by electric cables to Ireland and France.
Energy consumption in the United Kingdom has increased on average by just over 1 percent per year since 1950; however, the increase has been far from steady and since 2005 an annual decrease has instead taken place. During the 1950s, coal accounted for 90 percent of the total energy demand, but until the oil crisis in 1973, the oil demand increased to almost 50 percent. In 2012, coal, mainly imported, accounted for 20 percent of the energy supply, but only 8 percent of the energy produced in the country. The electricity is mainly produced from thermal power plants fired with coal or gas or produced in nuclear power plants. Of the energy supply, nuclear 2012 accounted for 10 percent and biofuels for 4 percent, while water energy (mainly in Scotland), geothermal energy and solar energy made only a small contribution.
The UK’s energy production is expected to be carbon neutral by 2050 and carbon neutral energy types (nuclear and renewable fuels) are expected to contribute 40 percent of electricity generation in 2020. The increase is due to a planned expansion of installations for the production of electricity from renewable fuels. The expansion of wave power is at an initial stage.
The relative importance of industry for the British economy has decreased throughout the post-war period, and especially after 1960. Between 1960 and 2017, industry’s share of GDP fell from 36 to 20 percent; the proportion of employed fell even more and was down 15 percent in 2015. The great unemployment that hit the country during the 1980s was largely due to the rationalizations of the industry.
Since the late 1980s, noticeable productivity growth has taken place, and today’s British industry is modern and competitive in many industries. The most important industries are engineering, electrical and electronic, food, chemical and paper, as well as printing and publishing. Machines for the textile and mining industries, tractors, bicycles, aircraft, cars and ships are among the products of the engineering industry. The two latter have been hit hard by the recession and structural changes during the 2000s. The domestic car industry also includes foreign (mainly Japanese and German) brands. The shipyards now primarily build warships, but increasingly face international competition. The space industry is also important. Manufacturing of computer equipment employs many in the electronics industry; several of the companies belong to foreign companies. Important branches of the food industry are dairies, bakeries, breweries and the manufacture of alcoholic beverages; of greatest importance here is the Scotch whiskey production. The chemical industry manufactures pharmaceuticals, soaps and detergents, paints and synthetic fibers.
Large parts of the British manufacturing industry now have foreign owners, while many of the British companies have moved manufacturing to low-wage countries.
The country’s foreign trade accounts for 1/4 of GDP. Until 1950, a very large part of Britain’s foreign trade took place with the countries that today constitute the Commonwealth. Even before entry into the EC in 1973, trade had shifted to Western Europe and the United States. In the 1950s, Western Europe accounted for 29 percent of exports; now the figure is about 60 percent, of which other EU countries account for the majority. The biggest change in recent years is the increased export of oil. Other important export goods are machinery, transport and chemical products.
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40 years ago, only 5 percent of the finished goods were imported, today it is close to 50 percent. Important import goods are machinery, transport equipment, computer equipment and chemical products, ie. largely goods within the same groups as exports. The three most important export and import countries are Germany, the US and China, which together account for 35 percent of all trade.
The UK is visited annually by between 25 and 30 million foreign tourists. Two thirds come from Europe (mainly France and Germany), while North America contributes just under one fifth. More than every other tourist visits London, among other destinations include the Scottish Highlands, the seaside resorts along the English south coast and Devon and Cornwall in south west England. The major national parks are appreciated for their natural beauty; the best known are the Lake District in the north of England, the mountain regions of Snowdonia in the north of Wales and the Dartmoor and Exmoor lakes in south-west England.
Note: the capital city of United Kingdom is London with a population of 8.9 million (official estimate 2018). Other major cities include Birmingham with a population of 1.1 million, Leeds with a population of 789,000, Glasgow with a population of 626,000, Sheffield with a population of 582,000, Manchester with a population of 548,000, Bradford with a population of 537,000, Edinburgh with a population of 518,000, Liverpool with a population of 495,000 (official estimates 2018).
The largest individual attractions are the British Museum, the National Gallery, the Natural History Museum and the Tate Modern, all in London.
Other tourist destinations are the cathedrals in York and Canterbury as well as Westminster Abbey in London. Also mentioned are the Tower, Madame Tussaud’s wax cabinet and the Paris Eye wheel.