World Video | Defence | Foreign Affairs | Natural Events | Trade | NZ in World News | NZ National News Video | NZ Regional News | Search

 

Why the Bank of England is wrong

London, UK. The Federation of European Employers (FedEE) reports .....

FOR IMMEDIATE RELEASE

Why the Bank of England is wrong

The Bank of England has just issued a forecast predicting zero growth this year – down from a prediction of 0.7% GDP growth three months ago. But the bank continues to downplay the United Kingdom economy because it is basing it on the wrong measure.

If you play conkers then you can recognise when someone is playing with stones rather than horsechestnuts. But what if the game is about winning and not sport? The problem with measuring the performance of the United Kingdom economy against the rest of Europe is that the Bank of England continues to regard it as a conker match and fails to see that the UK is an aggressive performer which does not compete on the same terms as most other countries.

The UK is by far Europe’s single biggest exporter of foreign direct investment in the rest of the world. It is not another Germany producing manufactured products or a country with a service economy largely based on retailing or IT services. UK investments can be found all over the globe and it owes its success to a powerful financial sector. For this reason GDP – which measures production within the confines of national borders – is not an appropriate measure of UK success. We therefore need to look at real gross national income (GNI) which takes into account the proceeds of foreign direct investments. And on that measure the performance of the UK looks very healthy – with significant gains for the last two available quarters in a row and a 5.7% improvement since Q3 2009.

Yes, Germany continues to outperform the UK in terms of real GNI – but because Germany’s economy relies on manufacturing it is necessary to offset the capital reinvestments required to maintain growth. On a net basis the UK economy is moving at an equal pace to Germany and there is every sign that this pace of growth could continue – unless companies believe the Bank of England and retrench.

Responding to the latest Bank of England forecast The Secretary-General of the Federation of European Employers (FedEE), Robin Chater, said at a press conference today that “ a reliance on GDP as the only measure of economic performance can be highly misleading and we must recognise that the world is far from the position it was in during the Autumn of 2007. We are in danger of talking ourselves into a double dip recesson and the UK has certainly reaped additional advantages in recent months from not being part of the eurozone.”

What is FedEE?

The Federation of European Employers (FedEE) is the leading organisation for multinational companies operating in Europe. It was founded in 1989 with assistance from the European Commission. It is a corporate member organization current Chaired by the HR Director of Ford Europe.

FedEE’s website is at http://www.fedee.com

ENDS

© Scoop Media

 
 
 
World Headlines

 


Tale Of Two Pandemics: Follow The Science And Do Not Forget One At The Cost Of The Other

Covid-19 has posed innumerable health, economic, and social challenges for all, including people living with HIV. It has exposed the fragility of health systems around the globe and has diverted political attention and funding from other infectious diseases like TB and HIV... More>>


UN: Rights Chief Calls For Prompt Release Of Protestors Held In Cuba
The UN High Commissioner for Human Rights on Friday called for the prompt release of protestors and journalists detained during anti-government demonstrations in Cuba, some of whom are being held incommunicado... More>>



Scarce Goods: Isolating Daraa Al-Balad Threatens 40,000 With Starvation

The siege imposed by the Syrian government forces on Daraa al-Balad since June 24 would lead to serious humanitarian repercussions if it continues, Euro-Mediterranean Human Rights Monitor said in a statement on July 15, calling for lifting the siege urgently and allowing the entry of basic humanitarian supplies... More>>


Focus On: UN SDGs



Shaping The Future Of Food Systems: Thousands Commit To Dialogues Amidst The COVID-19 Pandemic

More than 130 governments are making food systems a top priority amid the pandemic and committing to an unprecedented programme of Dialogues in the run up to the UN Food Systems Summit in September... More>>

UN: Play:Fair For People And Planet – A Major United Nations Music Activation
organized by the UN SDG Action Campaign in partnership with Music Innovation Hub, Keychange, the city of Milan, the Milan Triennale, and partners from the SDG Music Network, will be held at an unexpected location in the center of Milan, Italy, taking into account safety measures with a limited on-site audience consisting of activists and fans... More>>


UN: Next 18 Months Seen As Pivotal In Global Efforts To Achieve Key Goals

Next 18 months seen as pivotal in global efforts to reverse punishing pandemic impacts and boost actions to achieve key goals - Even as pandemic erases decades of gains in development, response efforts show signs of renewed global commitment to accelerate SDG progress... More>>