Economics blog

Unit 2 Macro: IMF Report on UK Economy calls for Increased Investment

In its annual assessment of the U.K. economy, the IMF called on the UK to invest in skills and infrastructure and increase banking sector competition in order to foster growth and achieve a sustainable recovery.

The report can be found here and contains plenty of relevant background information on the current situation facing the UK - here is a selection of quotes from their summary

"Economic recovery in the UK continues to be slow and fragile, as domestic de-leveraging pressures remain and external demand is weak."

"The effectiveness of monetary policy is undermined by persisting weaknesses in the banking system."

"Measures to improve the economy’s skills base and competitiveness would enhance the economy’s productive capacity while supporting demand in the near term."

"Securing growth momentum and rebalancing the economy are vital to boost incomes and income expectations, ensure the sustainability of public debt, and support bank balance sheets. A multi-pronged policy strategy is thus needed to address both demand and supply constraints that the UK economy faces."

Capital investment spending as a % of GDP

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