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  • UK economy: Britain’s true strength exposed as trade data shatters grim forecasts | United Kingdom | New

UK economy: Britain’s true strength exposed as trade data shatters grim forecasts | United Kingdom | New

By on August 19, 2022 0

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The statistics published by the International Trade Department (DIT) today show the value of total UK trade jumped 15% in the year to June, to a total of £1.4billion. Rebounding from the pandemic and an initial post-Brexit trade slump, the UK’s services surplus grew as the country attracted more money from foreign investors than any other except the United States.

Despite all the talk of impending recession, chronic low productivity and runaway inflation, the UK remains one of the strongest and most connected economies in the world.

The UK’s nominal GDP – the value of all goods and services produced in the country at current prices – was £2.86 trillion in 2022, the world’s sixth largest economy.

According Data from the International Monetary Fund (IMF)this means that the UK’s economic output exceeds that of France (£2.48 trillion) and Canada (£1.88 trillion), trailing only India, Germany, the Japan, China and the United States.

In the year ending June 2022, the UK was the world’s fifth largest exporter of goods and services, totaling £666.7 billion, according to DIT Statistics published today.

The UK was also the world’s sixth largest importer, buying £752.5 billion worth of goods and services overseas.

Liz Truss served as Foreign Secretary throughout the UK’s exit from Brexit and the pandemic (Image: GETTY)

In the year to June 2022, the UK exported slightly more goods (£348.5bn) than services (£318.2bn), according to the DIT data.

The main export partners of the United Kingdom were the United States (133.9 billion pounds), Germany (48.3 billion pounds), Ireland (45.1 billion pounds), the Netherlands (44.2 billion pounds) and France (33.3 billion pounds).

The most exported British goods included mechanical generators, crude oil, pharmaceuticals and cars.

Consultancy, business and research services led services exports, accounting for £126.8 billion of trade, followed by financial services with £61.3 billion.

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Port of Felixstowe

Port of Felixstowe handles 36% of UK containerized freight traffic (Image: GETTY)

On the import side, the UK buys far more goods from abroad (£565.6 billion) than services (£186.9 billion).

Over the past year, the UK’s closest import partners have been the US (£89.4 billion), Germany (£67.3 billion), China (£66.3 billion), the Netherlands (£43.5 billion) and France (£37.4 billion).

The main imported goods were gasoline, cars, pharmaceuticals and petroleum.

The UK has also attracted nearly two trillion pounds of foreign direct investment – money coming into the country from outside investors in UK businesses – making it the second most sought-after destination for the wealth of investors globally, behind only the United States.

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Map of global trade agreements

The UK has struck up to 70 trade deals with countries around the world since Brexit (Image: GETTY)

The UK’s total trade deficit – the difference between imports and exports – was at its highest level since records began 25 years ago in the first quarter of 2022, according to the Office for National Statistics.

However, the UK maintains a surplus in trade in servicesof which it was for a long time the second world exporter behind the United States.

This surplus has grown considerably over the past two decades, with exports of services exceeding imports by £4.8 billion in early 1997 to reach £34.7 billion today.

Natural gas, essential for heat and power generation, was the UK’s biggest import in the year to June 2022.

Reflecting the surge in gas demand following the end of coronavirus restrictions in the second half of 2021 and exceptional energy price inflation in the first half of 2022, the £38bn imported was nearly eight times more than in 2020.

The UK imports approx. half of its gas comes from the international marketmainly from Norway, which accounted for 77% of all UK gas imports in 2021.

Russia was once the UK’s main supplier of refined oil, but by June 2022 the UK had achieved its political ambition to do without Russian fuel imports entirely in response to the invasion of Ukraine.

Liz Truss in Boris Johnson's cabinet

Foreign Secretary Liz Truss has remained loyal to Prime Minister Boris Johnson throughout his resignation scandal (Image: GETTY)

While Brexit appears to have initially damaged UK trade volumes, figures show a resurgence is already well underway.

According Eurostat figures, imports from the UK to the EU fell by 13.6% between 2020 and 2021, but in the past year they have increased by 12.5%.

Thanks to trade deals signed with non-EU partners since Brexit, many brokered by Foreign Secretary Liz Truss, UK exports to the rest of the world have also increased by 6.8%, while imports have increased. climbed 25.6%.

In a speech setting out the The UK’s new trade policy Last year, Ms Truss said: “Naturally, after nearly fifty years of membership in the protectionist EU, we have lost the trade memory we had built as a sovereign trading nation.

“But we have rebuilt it: negotiating our own trade deals, defending our key industries and taking the lead.”