Britain crashes out of world’s top 5 economies
Britain has officially abandoned its claim to be the world’s fifth largest economy.
Treasury chief Philip Hammond acknowledged the slide on Wednesday, noting the new ranking in a series of statements meant to highlight the economy’s strength.
“Britain is the world’s sixth largest economy,” Hammond said in his closely-watched budget speech.
While there are several ways to measure the size of an economy, the U.K. Treasury pointed to GDP forecasts published by the International Monetary Fund in October to back up his statement.
The numbers show that France will narrowly squeak ahead of Britain in the group’s 2017 ranking of global economies, with its advantage predicted to widen considerably in 2018.
This year will be the first time since 2013 that France has topped the U.K. in the ranking, according to the IMF.
The slide reflects a sharp deceleration in Britain’s economic growth since it voted to leave the European Union in June 2016. The pound has weakened dramatically, consumer spending has slowed and prices have spiked.
On Wednesday, the Office of Budget Responsibility slashed its U.K. growth forecasts for 2017 from 2% to 1.5%. It expects a 1.4% expansion next year, followed by 1.3% in 2019 and 2020.
The loss of its top five spot to an EU rival is more bad news for politicians who argue that Britain will be stronger outside the bloc.
David Davis, Britain’s lead negotiator in Brexit talks, mentioned as recently as September that his country’s economy was the fifth largest in the world.
The U.K. is expected to slide further. India is forecast to power past both Britain and France in 2019.
Here are the world’s top seven economies, according to the 2017 IMF forecast:
- U.S. – $19.4 trillion
- China – $11.9 trillion
- Japan – $4.9 trillion
- Germany – $3.7 trillion
- France – $2.575 trillion
- U.K. – $2.565 trillion
- India – $2.4 trillion